Sofa-seller DFS is reviewing the pay policy of its top executives after shareholders mounted a revolt at its annual general meeting.
At the the furniture retailer’s annual meeting in November, some 30 per cent of shareholders rejected the compensation of chief executive Tim Stacey on the grounds his compensation rose faster than the average worker.
While 70 per cent of investors supported the policy, DFS said it was now reviewing its pay policy ahead of its next meeting in November.
“Following the AGM, the committee and has commenced a review of its remuneration strategy in preparation for bringing a Remuneration Policy to shareholders in November,” DFS said in a statement.
“The Committee Chair has written to all shareholders to seek feedback on its proposed approach to executive remuneration and we look forward to an ongoing dialogue with shareholders and proxy advisers on these matters.”
Stacey, who joined the firm in 2011, has seen his paypacket swell in recent years despite a slide in the value of its shares. In the year to June 2023, his total remuneration rose 34 per cent to £665,000 despite its shares sliding around 40 per cent in the previous three years.
The review will feed into concerns around executive pay in the City and the influence of so-called proxy advisors over corporate policy.
Glass Lewis, the second largest shareholder advisory firm, has been thrust into the spotlight in recent weeks after urging shareholders to reject the executive pay of bosses at LSEG and Abrdn.
Some in the City argue that proxy advisors urge shareholders to reject paypackets in the UK despite backing far bigger salaries in the US, hampering London firms’ ability to recruit. The average pay of US bosses dwarfs that of their UK counterparts, with S&P 500 chiefs making on average three times more money than FTSE 100 leaders.
The debate over London’s executive pay was triggered last year when the boss of the London Stock Exchange, Julia Hoggett, took aim at proxy firms for voting against London remuneration while waving through bigger salaries in the US.
Recruiting top staff was “hampered by the advice and analysis of the proxy agencies and some asset managers voting against executive pay policies even when those pay levels are significantly below global benchmarks,” she wrote in a blog last May.