Shareholders in WH Smith yesterday lodged a large protest vote at the board's failure to reduce the pay-off to Beverley Hodson, who was ousted as retail director a year ago.
Almost 15 per cent of the investors either voted against WH Smith's remuneration report or abstained from voting. In all, 15.9 million votes were cast against the report, compared with 94.6 million in favour.
Ms Hodson had received compensation of £569,000, way above her £339,000 annual salary. The sum included a controversial £112,000 to stay with the company over Christmas 2003 after she missed out on the chief executive's job.
One retail investor demanded to know if it was company policy to pay so much to sack underperforming board members. "You paid your previous director of retail a lot of money to go away even though anybody with half an eye could see there was something missing from the stores. If anyone else fails manifestly will they be paid vast sums of money to go away?", she asked.
John Barton, who heads the remuneration committee, said the payout was in line with the terms of Ms Hodson's contract. "She hasn't obtained other employment, which may not surprise you," he said, prompting gales of laughter from the 80-odd shareholders who turned out for the chairman Richard Handover's last annual meeting.
Mr Handover said the company was "well into the process" of appointing replacements for two non-executive directors who had stepped down. Robert Walker, the chairman of Severn Trent, will replace Mr Handover as chairman from Monday.