Shareholder call to rebel over 'excessive' Investec bonuses

Investment consultancy Pirc has called for a shareholder rebellion at Investec over ‘excessive’ remuneration policies and a lack of independent board membership.

Pirc, the UK’s leading shareholder advisory providing guidance to more than £1.5 trillion in institutional cash, issued the report ahead of the company’s annual meeting.   

In particular it criticised lax requirements for performance related bonuses, as well as excessive awards. In the last year awards equalled between 456% and 627% of salary.

‘Whilst salaries are broadly in line with the sector, aggregate awards made during the year are considered to be excessive,’ said Pirc.

‘All executive directors have six month rolling contracts. Directors are entitled to receive an annual bonus determined at the discretion of the remuneration committee.’

Investec Plc, parent company to Investec Asset Management and Investec Bank, does not set an upward limit on rewards, which are determined by value-added measures.

Share ownership awards rely on earnings per share. ‘We do not consider the targets to be sufficiently challenging in light of the current brokers forecasts,’ added Pirc.

The group also called on shareholders to challenge the appointment of a series of non-executive directors who fell short of its expectations of operational independence.

Samuel Abrahams has sat on the board for more than 13 years it said, while Ian Kantor has been on the board for more than 30 years and is brother to the MD.

Richard Thomas has sat on the board for 29 years, while Bradley Fried was previously chief executive of Investec Bank, while Fani Titi was previously chair of Tiso Limited, which Pirc said had a close working relationship with the company.