Investor backing for M&S executive pay plans

Just over 16 per cent of shareholders expressed their opposition to the executive pay plans, with 7.9 per cent opposing and 8.3 per cent abstaining.

This was considerably less than had been expected after investors were urged to oppose the remuneration report by governance body Pirc, which described the pay packages as "highly excessive".

The Association of British Insurers also issued an "amber top" warning on the remuneration report and investor group Manifest criticised the retailer's pay policies.

Tesco, the world's third biggest retailer, saw 47 per cent of its investors either voting against or abstaining over remuneration at its annual meeting earlier this month.

Small shareholders at the AGM yesterday expressed their concerns about Mr Bolland's pay package, describing it as "obscene" and "asking for trouble".

One shareholder told the AGM that the group should justify its boardroom salary and bonus levels.

But outgoing chief executive Stuart Rose said that Mr Bolland would only get the majority of his pay award if he meets stretching performance targets.

"The bulk of Marc's remuneration is at risk and if the company does well, Marc does well. I'm satisfied the two are aligned," he said.

Sir Stuart has argued that 87 per cent of Mr Bolland's package is dependent on the company hitting tough targets.

Company pay proposals are top of the agenda this week, with a number of firms holding annual general meetings.

Fashion group Burberry and property firm British Land are also set to face down shareholders over the issue of pay for top bosses.

Shareholders have been taking a more robust line on management pay during the economic downturn, although they have rarely forced through any changes.

One of the most controversial AGMs was held in May when more than two thirds of shareholders of Sheffield-based insulation group SIG voted against the remuneration report.

SIG's chief executive Chris Davies was awarded a pay rise despite the company reporting an annual pre-tax loss.

Attending his last AGM as chairman following six years at the top of M&S, Sir Stuart was praised by the board for his "remarkable" leadership.

In turn, Sir Stuart praised Mr Bolland saying he was pleased to be handing over the company to good hands.

Sir Stuart has had a rocky relationship with shareholders since 2008, when he combined the roles of chairman and chief executive against corporate governance guidelines.

He will become non-executive chairman on July 31 and is scheduled to stand down as chairman by next March.

Analysts and shareholders are keen to hear Mr Bolland's longer-term plans, which he will outline alongside interim results in November.

At the AGM yesterday Mr Bolland described himself as a person who prefers evolution to revolution and said that customer focus will be a key part of his strategy.

"It is very dangerous to have change for change's sake," he said.

Mr Bolland is credited with turning around Bradford-based Morrisons' fortunes after the difficult takeover of Safeway.

He chose to expand the positives such as the group's Market Street concept, its in-house butchers and bakers and strong focus on food, rather than bring in revolutionary changes.

Sir Stuart told shareholders there are signs British consumer confidence has started to improve since the June 22 budget which announced tax hikes and public spending cuts to rein in Government borrowing.

But analysts remain cautious on the outlook for consumer spending

Shares in M&S closed down 1.3 per cent, a fall of 4.5p to 349.1p, lagging a 0.3 per cent fall in the UK's benchmark FTSE-100 index.