Future, the UK’s biggest magazine publisher that is home to titles from Country Life to Metal Hammer, has been forced into an embarrassing sit-down with investors after a bruising shareholder revolt in which 60% failed to support its annual pay report – including a controversial bonus scheme in which its chief executive could be awarded £40m.
The board of London-listed Future has been forced to initiate a new consultation process with shareholders after failing to gain the 50% support required to pass its report on remuneration at the company’s annual general meeting on Thursday.
The level of executive pay at Future has been contentious for a number of years, with 40% of shareholders failing to back a scheme in which the boss, Zillah Byng-Thorne, could receive £40m in the coming years if the company continues to perform strongly.
Byng-Thorne, who was paid £8.8m last year, has made almost £34m over the last five years as a remarkable turnaround in the company’s fortunes has paid off handsomely.
The shares were down 9% after the pay revolt on Thursday, making Future the biggest faller on the FTSE 250.
Future said the shareholder revolt was against the value creation plan (VCP), in which staff will share an annual pot of £95m for three years if its stock rises 10% a year from September 2020 to 2025, as well as the terms of a payout to the former financial chief Rachel Addison.
While the vote is advisory and not binding – meaning the VCP which was passed by a separate vote last February cannot be unwound – the level of opposition forces the company into explaining and justifying its policies to shareholders again.
“The approval of the directors’ report on remuneration did not pass,” the company said. “As a result, the board will initiate a new consultation process with shareholders regarding the matter.”
There were also significant levels of voting against the reappointment of Mark Brooker, the chair of the remuneration committee, and the committee member Rob Hattrell, as shareholders vented their displeasure with the company’s decisions on pay.
“The board remains of the view that the all-employee value creation plan, which was approved by shareholders at the 2021 annual general meeting, incentivises and rewards the whole Future workforce and supports the long-term success of the business, and the continued creation of sustainable long-term shareholder value,” the company said. “The plan is directly aligned to shareholder interests and will only vest if the company delivers exceptional performance.”
