Abrdn shareholders urged to reject pay report over new CFO’s £675,000 salary

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Abrdn’s shareholders have been urged to vote against the asset manager’s pay report by influential adviser Glass Lewis due to the incoming chief financial officer’s “significant” salary.

Glass Lewis noted that Jason Windsor’s base salary of £675,000 was 25 per cent more than his predecessor Stephanie Bruce received and appeared to be more than the norm for such a position.

The adviser said although Windsor’s base salary is the same as for his previous job, it believes “that incoming executives should be appointed on a base salary lower than that of their predecessor”.

The proxy firm’s analysis paves the way for a potential investor backlash at the FTSE 250 asset manager’s annual meeting on April 24. It follows a difficult period for the fund group, in which its share price has fallen sharply, leading to its ejection from the FTSE 100 twice in recent years.

Chief executive Stephen Bird is attempting to revive the company’s fortunes by cutting costs and axing 500 jobs — amounting to 10 per cent of its workforce — while launching new products to attract other revenue streams. Abrdn and many of its peers have come under pressure as customers continue to withdraw money from funds run by stockpickers in favour of cheaper index-tracking products.

Windsor joined Abrdn in October after holding the same role at housebuilder Persimmon. He previously worked at insurance group Aviva for more than a decade.

Abrdn said in its annual report that Windsor’s pay was based on an “assessment of what it would take to attract the required skills and expertise from the market”.

But Glass Lewis said that shareholders could have been given a “more thorough rationale” for his “significant” base salary and further detail on how his pay compares with rivals. It added that “it would appear to exceed CFO salaries at the majority of the Company’s market capitalisation peers”.

Glass Lewis said it is “unable to recommend that shareholders support this proposal at this time”.

ISS, another high-profile shareholder adviser, is recommending shareholders vote in favour of Abrdn’s proposals at its meeting.

In response to Glass Lewis, Abrdn said: “Jason provides significant experience as a CFO who has spent several years working in large public companies. His appointment followed a rigorous process, including a detailed assessment of compensation that was based on a range of factors. He is already proving a valuable addition to the Board and management teams.”

Bird came under the spotlight earlier this year after telling staff that bonuses would only be paid for “performing colleagues”, while his total pay increased to £2.1mn last year from £1.7mn the previous year. Abrdn said at the time that linking pay to performance is “an important part of our approach to compensation across the company”.

However, an increasing number of UK boards are boosting chief executive pay to compete with US peers in an attempt to retain and attract talented managers, which has been cited as a hindrance to Britain’s capital markets.

 

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