HSBC will face a shareholder vote on executive pay later as concern grows regarding high rewards for bosses that do not reflect company performance.
The bank is holding its Annual General Meeting (AGM) later today. Shareholder advisory body Pirc is advising shareholders to vote 'no' regarding Chief Executive Stuart Gulliver’s proposed £7.2 million pay package.
Even if the majority of shareholders vote down a proposal on executive pay, their decision only counts as a recommendation to the board, and can be ignored.
Other companies that have faced shareholder opposition against executive pay recently include UBM, Aviva, William Hill, Xstrata, Trinity Mirror and Premier Foods.
Earlier this month, HSBC revealed a fall in profits after the company revalued the amount of debt on its books. Pre-tax profit for the first three months of the year was $4.3bn (£2.7bn) – down 12% on the $2.9bn the bank made a year earlier. However, revenue and underlying profits have increased sharply.
HSBC is cutting 30,000 jobs worldwide in a bid to cut costs. Some 2,000 of these roles will be from its UK operations.