Fresh twist in RBS paypacket row

By DAILY MAIL REPORTER
Updated:

 

ROYAL Bank of Scotland is facing heavy shareholder protests at its annual meeting on Wednesday, as the row over executive pay takes a fresh twist. The latest controversy involves £1m of share options awarded to executive deputy chairman Sir George Mathewson.

Influential lobby group the National Association of Pension Funds believes up to one fifth of shareholders will register protest votes.

The new row centres on a change in RBS policy affecting Mathewson's options. In 1999 he was not granted any new options because he was two years from retirement age. But a year later he was awarded almost 150,000 new options, worth more than £1m at today's share price. RBS says the change was designed to reward individuals who are 'key drivers of success'.

It also leaves the door open for future options awards to Mathewson, despite the fact he will this week surrender his executive role to become non-executive chairman.

Investors said RBS needs to clarify whether or not he is an executive. Stuart Bell of corporate governance group PIRC said: 'This is a muddle. Sir George cannot have his cake and eat it.'

The bank has come under fire for a series of lucrative pay and incentive awards, including controversial 'success' bonuses following its takeover of NatWest and the doubling to £1m of the pot to pay non-executives. 'They are just making up the plot as they go along,' said one corporate governance expert.

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