Pru puts heat on British Gas

BY BARRIE CLEMENT

and JOHN MURRAY

The country's biggest institutional investor yesterday warned highly paid directors at British Gas that they now have to "deliver".

Hugh Jenkins, head of Prudential Portfolio Managers, the largest shareholder in the privatised utility, said he was not consulted about the 75 per cent pay package awarded to Cedric Brown, chief executive of British Gas.

Mr Jenkins told the Commons employment committee that Prudential had requested "a little more of the background" from the gas company and had accepted the explanations.

He said that the British Gas chief's pay of £475,000 was "not over-generous". He added, however: "It is up to the company now to deliver performance."

In a submission to MPs, Prudential said it was championing the need for "performance requirements" before share options could be exercised.

The "man from the Pru", whose own £270,000 basic salary can be enhanced by a further 45 per cent, said Mr Brown's remuneration seemed to be in line with market practice for a company of that size.

Hugh Stevenson, chairman of Mercury Asset Management, the second-largest investor in British Gas, said he would support legislation to enforce disclosure of directors' salaries if this could not be achieved voluntarily.

Alastair Ross Goobey, chief executive of PosTel Investment Management, said he was not looking for restraint from senior directors of public companies, but investors should expect leadership.

Institutions should use their votes to curb excesses, he said.

Meanwhile, it emerged that directors of BAT, the tobacco and financial services giant, reduced overall boardroom pay last year, although some executives still received substantial increases. Total bonuses fell by £1m to £700,000 as profits across the group remained flat.

The biggest loser was Leo Denlea, the American who runs Farmers, BAT's US insurance subsidiary. His total pay halved to £591,000.

But Martin Broughton, the group's chief executive, saw his pay rise from £475,430 to £603,028 on the back of a £176,000 performance-related bonus.

The remuneration of David Allvey, finance director, jumped by more than £60,000 to £403,993 after a £101,500 bonus.

Eagle Star and Allied Dunbar chairman, George Greener, was the highest- paid director. He received £703,261, although his package has dropped from £776,079 in 1993.

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: Are you looking to take your ...

SThree: Trainee Recruitment Consultant

£20000 - £40000 per annum + competitive: SThree: Exciting career prospect for ...

Ashdown Group: Trainee Consultant - Surrey / South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Ashdown Group: Trainee Consultant - Surrey/ South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Day In a Page

A groundbreaking study of 'Britain's Atlantis' long buried at the bottom of the North Sea could revolutionise how we see our prehistoric past

Britain's Atlantis

Scientific study beneath North Sea could revolutionise how we see the past
The Queen has 'done and said nothing that anybody will remember,' says Starkey

The Queen has 'done and said nothing that anybody will remember'

David Starkey's assessment
Oliver Sacks said his life has been 'an enormous privilege and adventure'

'An enormous privilege and adventure'

Oliver Sacks writing about his life
'Gibraltar is British, and it is going to stay British forever'

'Gibraltar is British, and it is going to stay British forever'

The Rock's Chief Minister hits back at Spanish government's 'lies'
Britain is still addicted to 'dirty coal'

Britain still addicted to 'dirty' coal

Biggest energy suppliers are more dependent on fossil fuel than a decade ago
Orthorexia nervosa: How becoming obsessed with healthy eating can lead to malnutrition

Orthorexia nervosa

How becoming obsessed with healthy eating can lead to malnutrition
Lady Chatterley is not obscene, says TV director

Lady Chatterley’s Lover

Director Jed Mercurio on why DH Lawrence's novel 'is not an obscene story'
Farmers in tropical forests are training ants to kill off bigger pests

Set a pest to catch a pest

Farmers in tropical forests are training ants to kill off bigger pests
Mexico: A culture that celebrates darkness as an essential part of life

The dark side of Mexico

A culture that celebrates darkness as an essential part of life
Being sexually assaulted was not your fault, Chrissie Hynde. Don't tell other victims it was theirs

Being sexually assaulted was not your fault, Chrissie Hynde

Please don't tell other victims it was theirs
A nap a day could save your life - and here's why

A nap a day could save your life

A midday nap is 'associated with reduced blood pressure'
If men are so obsessed by sex, why do they clam up when confronted with the grisly realities?

If men are so obsessed by sex...

...why do they clam up when confronted with the grisly realities?
The comedy titans of Avalon on their attempt to save BBC3

Jon Thoday and Richard Allen-Turner

The comedy titans of Avalon on their attempt to save BBC3
The bathing machine is back... but with a difference

Rolling in the deep

The bathing machine is back but with a difference
Part-privatised tests, new age limits, driverless cars: Tories plot motoring revolution

Conservatives plot a motoring revolution

Draft report reveals biggest reform to regulations since driving test introduced in 1935