RE: 500p ask23 Nov 2016 20:32
Heres some info from the guardian on WPP who did a LTIP... Burford did one back in 2000 and maybe other times
Very,very good read below...If there is potential takeover bid ,then this meeting if votes to allow awarding directors shares rather than cash as a incentive would allow massive profits... Read from this what you wish-
Potential takeover or just sucking out money and watering down shares??
From the guardian...
"Long-term incentive plans for bosses 'damage firms'
Independent experts call for abolition of complex multi-year pay deals"
Incentive plans that have allowed bosses at companies including advertising giant WPP to collect tens of millions of pounds in pay should be abolished, according to a committee of independent experts.
The complex multi-year pay deals known as long-term incentive plans or LTIPs, now a feature of most FTSE 100 bosses’ remuneration, have driven executive pay up to “unwarranted levels” without delivering the same improvement in company performance, according to a report.
We need to recognise the flaws in the system and stop paying CEOs on metrics that encourage gaming,” the authors said. “We have looked at the growing complexity of awards that has pushed directors’ pay into the stratosphere and found there is little discernible link with corporate success. In fact, there is an argument that it is actually damaging the economy.”
Produced by a commission convened by the High Pay Centre, whose members included Simon Walker, director general of the Institute of Directors, and former Hermes fund manager David Pitt-Watson, the report concludes a year-long inquiry into how corporate Britain’s top brass are rewarded.
City economist Andrew Smithers, also on the committee, argues that many pay plans effectively encourage executives to slash investment – either in equipment or human resources – to a potentially unsustainable level, while pursuing speculative takeovers and concentrating resources on share buybacks in order to increase the share price, boosting their LTIP payouts – which are usually in the form of shares in the company.
LTIP payments to FTSE 350 directors increased by more than 250% between 2000 and 2013, about five times as fast as returns to shareholders, the report says.
Evidence that performance-related pay actually improved performance was weak, said the report’s authors, while targets linked to profits and the share price can “create perverse incentives that are damaging to businesses and the wider economy in the long-term”.
WPP founder and chief executive Sir Martin Sorrell’s long-term pay plan, which sparked repeated shareholder protests, boosted his total pay to £30m in 2013 and £43m in 2014, making him the best paid UK public company boss two years running.
At Cable & Wireless, a notoriously value destroying demerger saw the telecoms company split
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