Spur meets resistance over directors' pay

Sanlam Investment Management confirmed yesterday, 7 December, it was among the investors who voted down Spur's proposal at its annual meeting last week, saying it had given its reasons to the company's directors.

"Sanlam Investment Management cannot offer any further comment currently as its policy is to engage directly with companies on these matters rather than do so in the public domain," it said.

Van Tonder said yesterday he would engage with shareholders who refused to endorse the group's remuneration policy.

Shareholders also refused to authorise payments made to directors in the past financial year, putting the spotlight again on what many regard as excessive remuneration for executives.

Van Tonder said Spur put emphasis on its relationship with shareholders and there was constant engagement with them, which was why the proxy votes came as a surprise last week.

"Shareholders have raised their concerns and first order of business next year will be to meet with them to understand these concerns," he said. "The role of nonexecutive directors is not what it was 10 or even three years ago, and their remuneration has not caught up."

Spur had used a benchmarking process and the proposed figures were in line with what companies similar to Spur had paid executives, he said.

Van Tonder hinted that investors were unhappy about the retrospective payments, but said the company would amend these, if need be.

Spur has proposed R350000 for each nonexecutive director next year, from R250000 this year and R100000 last year.

Last year, the company paid a total remuneration for both nonexecutive and executive directors of R13,1m, which included bonuses, and this financial year that figure grew to R15,1m.

In its annual report, Spur says the increase proposed for next year was considered in the "context of the increased level of participation contemplated in King 3 and the greater risk assumed by directors in terms of the Companies Act 2008".

Activist shareholder Theo Botha said it was a trend that companies would see more of.

Last month, Botha questioned Sasol's decision to give its CE, David Constable, a remuneration of R828000 for one month's work.

"Shareholders won't stand back any more, they will not let just anything through now."

Separately, the Financial Services Board confirmed it had received a complaint against Spur. It said it would have to study the complaint "to see if there has been a possible contravention of the Securities Services Act with regard to market abuse".

Source: Business Day