Shareholder opposition to executive pay has risen across FTSE 350 companies during the UK 2025 AGM season so far.

Georgeson analysed voting outcomes of remuneration report resolutions, representing more than 55% of the AGMs in the FTSE 350 index, from January to the end of May. This mid-year analysis offers early insight into the key factors influencing investor behaviour when it comes to the typically most contentious voting issue: executive pay.

More than three times as many companies received significant shareholder opposition (20% or more ‘against’ votes) to executive pay this year: 8.2% in the first five months of 2025, compared with 2.6% during the same time period last year.

Figure 1: Shareholder dissent on executive pay (1 Jan to 31 May for each year)

Georgeson: The five-year evolution in shareholder opposition to remuneration reports

The Investment Association considers 20% or more shareholder opposition as ‘significant’. In such cases, companies are expected, in accordance with the UK Corporate Governance Code, to engage with shareholders and disclose the outcomes of these engagements.

Executive pay resolutions receiving 10% shareholder opposition or ‘contested votes’ are seen as an early warning sign of initial investor concern that may evolve into an issue if not addressed.

From the beginning of 2021 through to 2023, the share of remuneration report resolutions that faced significant opposition remained steady, at around 10%. Such resolutions dropped substantially in 2024—a year when only 2.6% of the index saw them receiving less than 80% support. However, the proportion of remuneration reports with significant opposition rose again to 8.2% in 2025.

‘Against’ recommendations by proxy adviser ISS correlated with shareholder opposition on remuneration reports. ISS recommended voting ‘against’ only 3.6% of FTSE 350 remuneration reports in early 2024, compared with an average of 10.4% from 2021 to 2023. In 2023, 24.6% of companies faced over 10% opposition.

In 2024, this dropped to 10.3% but, in line with the other trends, opposition has increased again in 2025, reaching 14.4%.

Figure 2: Share of contested renumeration report resolutions correlated with ISS ‘against’ recommendations (all data refer to the first five months of each year)

Reasons for opposition

Several factors around inflated payouts and fairness caused opposition to executive pay to spike in 2023.

One of the most common points of contention that specifically led to more opposition in 2023 was the reported outcomes of long-term incentives (LTI) granted to executives during the Covid-19 pandemic.

Many investors perceived that, in some cases, executives unjustifiably benefited from ‘windfall’ gains—the idea that executives might have benefited from artificially depressed share prices at the beginning of the performance period (during the pandemic), with the share price naturally bouncing back over the subsequent three-year period, causing an abnormal increase to the potential LTI award.

The 2023 season also coincided with heightened public focus on the cost-of-living crisis across many countries, including the UK, which prompted the scrutiny of executive pay increases. In some cases, investors questioned the appropriateness of awarding generous pay packages to executives during this time.

During the 2024 AGM season, many companies became more cautious about their executive remuneration than in previous years. There was also a pointed national debate around the competitiveness of the UK economy. Some companies raised the prospect of moving their listing and incorporation away from the UK, in search of more dynamic markets. Attracting new companies to consider the UK for their initial public offering was seen as a priority. As a result of this mix of factors, shareholder opposition to executive remuneration declined meaningfully.

Shareholder opposition rebounds in 2025

Despite increased attention on the transatlantic pay gap, many analysts have said the difference between executive remuneration packages in the US and the UK has continued to widen in recent years.

Sensing that some investors and proxy advisers may have softened their approach to executive pay in the UK, possibly in response to the challenges that British companies face in attracting and retaining talent, a number of companies pursued executive pay increases in 2025.

However, the significant decline in shareholder dissent to remuneration resolutions observed during 2024 may prove to be an anomaly, as opposition from investors and proxy advisers has increased considerably during 2025. However, the proportion of reports with significant opposition is still somewhat lower than in previous years (2021-23).

The number of resolutions with over 20% opposition so far in 2025 has been three times the count during the same period in 2024.

As of 30 May 2025, the S&P 500 share index had nearly doubled in value over the previous five years, whilst the FTSE 350 grew by 40%. Some investors argue that companies aiming to narrow the executive pay gap with their US counterparts must demonstrate an ability to deliver returns that meet or exceed those benchmarks.

Key takeaways

Early trends offer key takeaways to the remainder of the 2025 AGM season.

The uptick in shareholder opposition to executive pay suggests that any perceived softening in sentiment last year may have been short-lived.

Investors and proxy advisers continue to expect a clear link between pay and performance, as well as remuneration being set in a way that is fair when compared with the average earnings of the broader workforce. For companies, particularly those seeking to increase executive remuneration packages, the message is clear: early, transparent and meaningful engagement with shareholders is essential.

Understanding investor concerns and incorporating their feedback into remuneration disclosures and structures reduces the risk of significant dissent and strengthens long-term governance, as well as trust.

Ongoing shareholder engagement starts shortly after the annual meeting concludes. Companies that maintain an open dialogue with investors, stakeholders and proxy advisers typically succeed in garnering higher overall shareholder support.

As the season continues, remuneration committees will find that thoughtful, proactive dialogue with shareholders will help to align them more fully with the company. Companies able to achieve this are more likely to gain confidence that their approach to the tricky topic of executive pay, among others, is the right one.

Daniel Veazey is corporate governance manager and Kevin O’Neill is corporate governance analyst, both at consultancy Georgeson.