Three more pay plans suffer protest votes

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The Independent Online

The shareholder spring continued yesterday with investor revolts against boardroom pay at the insurance giant Prudential, the oil explorer Cairn Energy and the engineer Cookson.

At Prudential's annual meeting, more than 30 per cent of shareholders voted against the company's remuneration report, which stated that Michael McLintock, the head of its M&G fund management outfit, should be paid £7.6m – 60 per cent more than the £4.7m being trousered by the chief executive, Tidjane Thiam.

The chairman, Harvey McGrath, acknowledged the large size of the revolt, saying: "We will, of course, engage with them to understand their concerns and to consult with them on how best to structure our remuneration."

Earlier this month, the chief executive of rival insurer Aviva, Andrew Moss, stepped down after shareholders voted against the company's executive pay.

Separately, the industrial materials specialist Cookson saw nearly a third of shareholders rebel against a £6m incentive payment for the chief executive, Nick Salmon.

The activist shareholder Cevian, which has been agitating for change at the business, got one of its executives, Christer Gardell, on to the board.

Cookson said it was now planning to split itself in two, meaning investors would get separately listed shares in its engineered ceramics and performance materials divisions.

Engineered ceramics, whose products are used in the glass and solar power industries as well as by steelmakers and foundries, recorded £1.69bn of revenues last year. Performance materials, about half that size in sales terms, supplies materials and chemicals to the electronics, car, industrial and construction markets.

The demerger would represent the next step along the way in Cookson's bid to enhance its share price, following the sale of its loss-making US precious metals processing business to Warren Buffet in February.

Meanwhile, 67 per cent of investors voted against Cairn Energy's remuneration report, although the vote is not binding on the board. Although the oil explorer abandoned plans to pay a one-off bonus to its founder, Sir Bill Gammell, earlier this year in the face of investor objections, it has been criticised by the corporate governance specialist Manifest for remuneration "above expectations given the company's size and scale, its sector and performance".