Shareholders revolts remuneration reports look on course to equal this year the number in the 2022 AGM season, despite calls in some quarters for higher executive pay.

The Investment Association’s Public Register of shareholder revolts—a revolt being defined as a vote of 20% or more against an AGM resolution—shows that 14 companies have so far seen shareholders turn against their remuneration reports.

The most recent were Clarkson Plc, the giant shipbroker, which saw a 43.69% against the company’s remuneration report, and Wood Group, an energy industry consultancy, which suffered 23.02% opposition.

With 14 such events having occurred by mid May, revolts look like they will equal last May’s total of 25. Last year saw a total of 58 companies suffer shareholder revolts on remuneration reports, equalling the number in 2021 but significantly up on 2019. Then, the figure stood at 38, as shareholders eased the pressure on boards because of the pandemic.

Voters’ leverage

The largest revolt so far this year has been the vote against Unilever’s remuneration report, when 58.03% of the votes cast were turned against the company.

Other notable revolts include Topps Tiles in January when 41.85% of votes opposed the remuneration report. Ocado saw a 30.14% revolt and Compass, the food contract company, 29.68%.

Executive pay is rarely out of the headlines, but recent weeks have seen several high profile City figures raise the issue, claiming the UK is becoming uncompetitive on pay for top executives.

These were dismissed by some close observers of pay trends. Luke Hildyard, director of the High Pay Centre think tank, said the calls were “tone deaf”.

“The evidence that the UK is losing potential executives to international rivals and that this is harming the UK economy—or even the UK listed market—is really thin,” he said.

In a blog post, the London Stock Exchange’s chief executive, Julie Hoggett, wrote: “We should be encouraging and supporting UK companies to compete for talent on a global basis, so we remain an attractive place for companies to base themselves, stay and grow.” She added: “The alternative is we continue standing idly by as our biggest exports become skills, talent, tax revenue and the companies that generate it.”

Despite the current list of pay revolts, some investment managers have indicated their willingness to discuss higher pay levels for the C-suite.

Peter Harrison, chief executive of Schroders, told the Financial Times: “This is a question that broader society needs to answer—which is more important: limiting the gap between CEO and worker pay, or accepting that boards need freedom to attract the best CEOs to run British companies for the best long-term outcomes?”

Executive pay is back on the agenda of those considering the future of UK companies. The IA’s Public Register may well give us an indication of whether shareholders agree.