(Reuters) – The head of the British parliament’s Work and Pensions Committee has written to the chair of Standard Chartered Plc’s <STAN.L> remuneration committee questioning the bank’s executive pension pay levels after more than a third of shareholders voted against its directors’ remuneration policy.
In the letter written on Thursday and made public on Monday, Committee Chairman Frank Field asked why the remuneration committee put forward a proposal where the existing directors would receive 40% of base salary (20% of total salary) as the pension contribution whereas the contribution of new executive directors is limited to 10% of total salary.
The letter also questioned whether the remuneration committee supported the Investment Association’s guideline that pension contribution rates for executive directors should be aligned with that of their workforce and inquired if the remuneration committee planned to revisit the executive pay policy next year.
Some 36% of StanChart’s shareholders voted against the bank’s 2019 directors’ remuneration report at its annual shareholder meeting in London, which set out plans to increase Chief Executive Bill Winters’ pension allowance among other measures.
Investors were also frustrated as the bank failed to cap pension contributions as a percentage of base salary, instead calculating against a bigger total salary base.
The letter from Field closed by asking whether the remuneration committee shared the views of Winters, as reported in the Financial Times, where the chief executive called investors “immature” for voting against his pay package.
Winters and remuneration committee Chair Christine Hodgson said earlier they believed the pension allowances paid to executives were in line with British corporate governance codes, even though the bank’s definition of basic salary includes fixed-pay allowances paid in shares as well as cash salary.
(Reporting by Rishika Chatterjee; Editing by Peter Cooney)