Members quiz mutual bosses over executive pay

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YORKSHIRE Building Society bosses faced probing questions about executive pay at the mutual’s annual general meeting yesterday.

Although some members were sceptical about the merits of the society’s policy over deferred bonuses, other members supported the measure, because they believed it was in the best interests of management and members. The building society’s members voted to approve the mutual’s directors’ remuneration policy by 89.13 per cent. All the other motions presented to yesterday’s annual meeting, including the re-appointment of Deloitte as auditors, were passed with overwhelming majorities at Bradford’s Midland Hotel. According to the accounts, the society’s chief executive Chris Pilling’s total salary and benefits last year were £870,000. This includes a salary and pension cash allowance of £601,000 and, deferred elements to be paid in 2014 of £153,000. The year before, Mr Pilling’s total salary and benefits were £748,000. This included £99,000 deferred variable pay. A society spokesman said about Mr Pilling’s salary and benefits in 2013: “Deferred payments for Chris accrue over three years – this refers to the second of the three years.”

Simon Turner, the chairman of the remuneration committee, said: “In the pay review process, the average rise in base salary for all executive directors was 3.15 per cent. The remuneration of the chairman and other non-executive directors was increased by an average of three per cent. These increases are in line with those applied to other colleagues in the society. A significant proportion of bonus payments for all executive directors and many senior managers is deferred. For the chief executive, the deferred element will be 60 per cent of the bonus awarded, deferred over three years. For other executive directors and senior managers, 50 per cent of awarded bonuses will be deferred over two years.The remuneration policy is designed to ensure that it’s feasible that no payment would be made, and deferred elements from previous years reduced or fully cancelled, if performance has been unacceptable.” Mr Turner said it was the board’s view that the senior management team performed exceptionally well in 2013.

Graham Pearce of KPMG

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