London Stock Exchange Group facing pushback from investors over executive pay

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The Institutional Shareholder Services (ISS) pressure group has urged shareholders to vote against the pay packages of the top brass at London Stock Exchange Group PLC (LON:LSEG).

Sky News reports that the ISS has called on investors to vote against the remuneration report at the company’s annual general meeting (AGM) on April 28, taking issue with the 25% increase in the base salary of the chief executive officer David Schwimmer to £1,000,000 a year.

“While the [Remuneration] Committee is aware that this is a large increase in absolute terms, both salary and total compensation will continue to be positioned below the lower quartile of the FTSE 30, while LSEG will be positioned firmly within the top 15 companies in the FTSE in terms of size,” the LSE’s annual report said.

The FT 30 index is an index that predates the FTSE 100 by several decades and was last referred to in serious conversation in about 1982.

On top of his base salary of £1mln, Schwimmer has a maximum annual “bonus opportunity” of 225% of his annual salary, while his 2021 long-term incentive plan ceiling is 300% of salary.

David Schwimmer, chief executive of London Stock Exchange Group, has seen his pay jump, hitting £6.9m in 2020 compared to £2.5m in 2019. This came as LSE’s share price hit record highs.

BTG Advisory (@BTG_Advisory) March 23, 2021

“Shareholders were consulted on the proposed increase and were broadly supportive of the underlying principle given the significant change in the CEO’s role post-transaction,” the firm’s annual report said.

The use of the term “broadly” suggests the remuneration committee received some pushback from institutional investors and now lit looks like this opposition will manifest itself in votes at the AGM that the company will be at liberty to ignore.

While it is not uncommon for companies to push pay rises for executives after a transformational deal executed by those same executives, institutional investors generally prefer to wait and see if the deal has been transformational in the right way, i.e. produces the expected benefits.

Shares in London Stock Exchange Group collapsed from 9,489p to 7,606p on March 5 when the company admitted the integration of Refinitiv would cost much more than expected.

READ London Stock Exchange tanks as Refinitiv costs spook investors

 

Two things before anyone gets excitable:
– that’s a general, nonspecific market observation. I’m interested,I play a little. Y’all know the rules,and I don’t know anything you don’t know anyway.
– Yes,the LSE chief exec is David Schwimmer.
Not that one.
He’s heard that a lot. pic.twitter.com/iEkyWW5zeB

— ???????????????????? ???????????????????????????????? (@LancePaters1) March 18, 2021

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