Reckitt pay battle looms

Shareholders are being advised to withhold support for pay packages at the household products manufacturer Reckitt Benckiser.

The National Association of Pension Funds has advised its members, which run £700bn of investment funds, to abstain when voting for the company's remuneration package.

The organisation criticised the generosity of the share incentive plan for directors. It is also opposed to excessive golden handshakes, which would give them one and a half times their year's salary and the equivalent of two times their annual bonuses if they leave.

For this reason the NAPF has withheld support for the re-election of Bart Becht, the chief executive, who received a bonus of £1.5m last year and a total pay packet of £2.6m. It is also withholding support for non-executive director Peter Harf, who sits on the remuneration committee deciding pay levels. The NAPF does not consider him sufficiently independent.

Reckitt Benckiser's annual general meeting will take place on 7 May.

Last week the NAPF also opposed pay packages at Reckitt Benckiser's fellow FTSE 100 member, the banking group Alliance & Leicester. The NAPF said a clause giving an extra six months' pay to directors if the company is taken over was not acceptable.

The bank has previously been looked over by competitors, including Abbey National and the Bank of Ireland. Its small size makes it attractive as competition regulators keep a close eye on the sector.

The NAPF is also advising shareholders to withhold support for the election of finance director David Bennett and operations director Chris Rhodes over the same issue. A&L's AGM, at which shareholders will vote, is on 6 May.

The NAPF has increasingly voiced its opposition to excessive corporate pay deals. Blue chips including Shell, Schroders, Reuters, Barclays, Anglo American and BG have come under fire.