Insurers" chief targets banks over excess in the boardroom

Insurers' chief targets banks over excess in the boardroom

UPDATED:

21:11 GMT, 28 April 2012

AS Barclays reeled from an unprecedented rebellion among shareholders last Friday, the new boss of the Association of British Insurers told Financial Mail that banks must ‘urgently correct’ the balance between remuneration, returns to shareholders and capital retention.

Warning: Association of British Insurers boss Otto Thoresen hit out at outrageous boardroom pay

Otto Thoresen hit out at outrageous boardroom pay after 27 per cent of shareholders at Barclays’ annual general meeting voted against the directors’ remuneration, including the 17.7million package awarded to chief executive Bob Diamond.

Thoresen, head of an organisation that represents some of Britain’s biggest investors, said: ‘Investors take executive pay very seriously. It
is crucial there is the correct balance of returns to shareholders, payments to employees and capital retention to support the investment case for all banks.’

He
added: ‘There now needs to be a clear alignment of boardroom reward
with long-term sustainable growth of the economic value of the company.’

Simon Walker,
director general of the Institute of Directors, said: ‘Barclays is
paying three times more in bonuses to top executives as it pays in total
dividends to all shareholders, which is basically the pensioners of
this country.’

Alison
Carnwath, chairman of the remuneration committee that set the Barclays
board’s pay levels, was also targeted, with more than 23 per cent of
shareholders voting against or abstaining in her re-election.

Shareholder uprisings are becoming the theme of this year’s season of bank annual meetings.

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Insurers" chief targets banks over excess in the boardroom