Fashion giant Boohoo set to join official ‘list of shame’ after investors rebel over fat cat pay: But founder survives
Fashion giant Boohoo is set to join an official ‘list of shame’ after investors rebelled over fat cat pay.
Under a controversial bonus scheme worth £150m, co-founders Mahmud Kamani and Carol Kane could be handed £50m each if the firm’s market cap reaches £7.5billion by 2023. It currently stands at £4.1billion.
But the plan, introduced without shareholder consent last year, triggered a revolt at Boohoo’s annual general meeting yesterday, with 20.2 per cent of votes opposing the remuneration report. It means Boohoo joins the Investment Association’s list of shame which records revolts that win more than 20 per cent support.
Staying put: Carol Kane saw off a bid to oust her over the treatment of workers at its factories
A string of rebellions at AGMs this year has triggered talk of a ‘shareholder spring’, with household names getting caught up.
Supermarket Morrisons and Premier Inn owner Whitbread have suffered big rebellions over executive bonuses. Yet yesterday’s result will have come as a relief for bosses at Boohoo, amid fears the rebellion was set to be even bigger.
Kane also saw off a bid to oust her over the treatment of workers at its factories.
A report uncovered ‘excessive’ hours, life-threatening conditions and illegally low pay in Leicester. It prompted critics to demand Kane be kicked off the board for failing to prevent the scandal, with shareholder advisory service Glass Lewis saying she contributed to ‘inadequate governance practices’.
On the eve of the vote, the Business & Human Rights Resource Centre, Labour Behind The Label and Share Action claimed Boohoo did little to improve the situation.
But the motion to remove Kane won just 12 per cent support, after the Kamani family, who control 26 per cent of voting rights, and Jupiter Asset Management, which has a 9.8 per cent stake, stood by her.
Boohoo chief executive John Lyttle was ‘delighted’ by the result. He said: ‘Carol plays an integral role in establishing the identities that sit behind each of the brands and as a co-founder her drive, enthusiasm and unwavering support for our agenda for change will be crucial.’
Boohoo said independent reviews by judge Sir Brian Leveson confirmed ‘substantial action’. Shares fell 1.6 per cent, or 5.2p, to 326.5p.