Clarksons has survived another revolt on its executive pay policy, but huge shareholder concern over the issue is still evident.
Shareholder proxy firms had recommended voting down the London-listed shipbroker’s policy at the annual general meeting on Thursday.
Clarksons carried the day again, but the remuneration report received the backing of only 57% of the votes.
Remuneration committee chairman Tim Miller was re-elected with 62% of the votes, while chairman Laurence Hollingworth received 78%. Most other agenda items gained near-unanimous approval.
The issue centres on chief executive Andi Case and finance and operations chief Jeff Woyda being paid big bonuses for their dual roles. Case is a major fee-earning broker as well as CEO.
The brokerage said it had “noted” the results of these three votes.
“We appreciate the support from most of our shareholders and will continue our engagement over the year ahead,” it added.
Last May, investors rebelled in increased numbers, with votes on the remuneration report winning only 56% support.
This was down from nearly 63% in 2022, but not as close as in 2019, when Clarksons got over the line with only 51%.
Case took home £11.9m ($15.1m) last year. Woyda earned £350,000, plus a bonus of £2.7m, for a total of £3.7m, up from £3.3m the year before.
Shareholder proxy advisory companies Glass Lewis and Pirc opposed the legacy pay deals.
Glass Lewis said that although Case and Woyda had waived part of their bonus in previous years, a company’s pay policy “should not rely on the goodwill of its executives to mitigate excessive payouts”.
18 years of investment
Miller said earlier this week: “Clarksons’ shareholders have benefited from 18 years of sustained and strategic investment led by Andi Case, which has delivered the world’s leading shipping services business, a UK success story and an increase in value under Andi’s tenure of over 1,800%, from £62m to over £1.2bn today.”
Miller explained at the time of the annual report in April that executive pay arrangements were in line with those of other leading bosses in its market.
“It is essential that we retain and attract the best colleagues and leaders in a highly competitive market,” he said.
The company said it continues to recognise the need to pay other staff appropriately, with 83% of the workforce receiving bonuses for 2023 and 67% winning salary increases.
Net profit was £85.8m last year, up from £79.6m in 2022.
Record underlying pre-tax earnings were £109.2m, compared with £100.9m the year before.
Positive start to 2024
Hollingworth told the meeting the group had made a positive start to the year, “helping clients to navigate the ongoing complexities and disruptions to global trade, by providing the expertise, data and insights to enable them to make the right decisions for their organisations”.
“The broking division continues to perform strongly with spot business transacted to date in line with last year as expected,” he said.
The chairman explained that results will again be weighted towards the second half of 2024, because of the invoicing profile of the forward orderbook, together with the increase in voyage duration arising from lower volumes through the Suez Canal after Houthi attacks on shipping.
The financial division, while continuing to “build pipeline and remaining transactionally active”, is experiencing more challenging capital markets within Clarksons’ investment banking activities.
“The outlook for Clarksons continues to be positive,” Hollingworth concluded.
