The retailer's executives have 48 hours to agree to scrap the scheme and investors are also demanding chairman Sir Peter David to return a portion of his £2.4 million bonus or to donate it to charity.
Major UK institutional shareholders own 40 per cent of J Sainsbury shares and some, such as the Association of British Insurers and the National Association of Pension Funds, recommend members to withhold or vote against the remuneration report at the agm, and the corporate governance lobby group Pirc advise to oppose the report altogether.
“If Lord Levene doesn’t manage a face-saving deal over the next two days, most UK institutions are going to vote against” said a shareholder. Lord Levene is the group’s senior independent director and is attempting a last-minute deal with institutional investors to avoid the revolt. The initial offer of the chairman giving up 10 per cent of his bonus was not welcomed by investors, who think that the company’s performance targets are easy and that Sir Davis still collected 86 per cent of his maximum allowance despite a drop in profit and sales. The chairman’s pay scheme runs for another year, potentially providing another £1.5m in shares.
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