Compass Group, the FTSE-100 catering giant which counts the Wimbledon tennis championships among its most prestigious contracts, is in talks with its investors to boost its boss’s potential pay packet by millions of pounds a year.
Sky News has learned that Compass is consulting its biggest institutional shareholders about significant increases in the annual bonus and long-term share award it could give to Dominic Blakemore, chief executive, from 2018.
City sources said on Wednesday that Compass was proposing to increase both the annual bonus, which pays a maximum of £2.3m to Mr Blakemore, and the LTIP (long-term incentive plan), which has a maximum annual grant value of around £4.6m
A consultation process with leading investors is said to have been underway for weeks, with a view to the revised remuneration policy being voted on at the annual meeting next February.
The consultation also covers the rewards package available to Petros Paras, Compass’s chief financial officer, and Palmer Brown, group chief operating officer, North America, where the company now generates two-thirds of its revenue.
Mr Blakemore earns a basic salary of £1.16m, receiving a 5.9% rise which took effect on January 1.
Last year he received almost £7.5m – more than double what he earned in the previous 12 months.
A source close to the company pointed to Compass’s recent financial results, with figures showing it has delivered a total shareholder return of 53 per cent since Mr Blakemore became chief executive – compared with 30 per cent for FTSE-100 index.
Earnings per share also rose 19% over the same period.
Compass’s proposals to increase its maximum pay package come amid an intense debate over the competitiveness of FTSE-100 executive compensation.
A number of companies, including Flutter Entertainment, have moved their IPOs to the US, while the CEO of the London Stock Exchange said the corporate drift across the Atlantic was likely to continue unless UK-based CEOs were paid on par with their American counterparts. peers.
Mr Blakemore is a non-executive director of the LSE’s parent company, the London Stock Exchange Group, which itself secured investor backing in recent months for a sharply higher remuneration package for its chief executive.
High pay campaigners claim that UK company bosses are already paid too much, given the average wage of UK workers.
One investor who participated in the consultation process said he supported Compass’ proposals.
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The company has performed strongly since the COVID-19 crisis, when it was forced to raise £2 billion from shareholders amid a near-total shutdown.
Compass, which employs hundreds of thousands of people worldwide, said at the time that its cash payment was partly aimed at boosting acquisitions after the pandemic.
Earlier this year it struck a £400m deal to buy CH&Co, which provides hospitality services at Kew Gardens and the Royal Opera House.
The shares it sold in 2020 were issued at 1,025p and have since more than doubled, reflecting the huge rebound enjoyed by parts of the catering and hospitality sectors.
Compass shares were trading at around 2,400p on Wednesday, having risen more than a fifth in the past 12 months.
The company now has a market capitalization of over £41 billion.
Compass declined to comment.
