Press releases

Deloitte analysis: 2017 AGM season calmer than expected

7 July 2017

  • FTSE 100 so far defy predictions of stormy AGM season as companies adapt remuneration policies to meet investor demands
  • Bonus pay-outs slightly lower than last year

The 2017 AGM season has so far been calmer than expected by some, with FTSE 100 companies acting to ensure they receive high levels of support for directors’ pay, according to analysis by Deloitte. With two thirds of the season completed, the median level of votes in favour of directors’ remuneration reports remains at 96%. The report also shows that more than eight in ten of the FTSE 100 companies to hold an AGM between January and June this year received over 90% of votes in favour of directors’ remuneration. This compares to 75% of companies receiving over 90% of votes in favour last year.

Only one FTSE 100 company has not received a majority of votes in favour of their remuneration report so far, while just 7% have received less than 80% of shareholders’ support. This compares to 11% in 2016.

Stephen Cahill, Vice Chairman at Deloitte, commented: “Companies have acted to ensure they continue to receive high levels of support for directors’ pay arrangements in 2017 and avoid the prospect of shareholder revolt. Many remuneration committees, no doubt conscious of ongoing political debate on executive pay, have exercised restraint on pay decisions and have implemented policies which meet investors’ demands for greater alignment with the interests of shareholders.”

Cahill continued: “Remuneration committees have become much more proactive in understanding the views of investors and addressing concerns.”

Proxy voting agencies have issued fewer recommendations to vote against remuneration reports in 2017. Institutional Shareholder Services (ISS), for example, issued recommendations to vote against pay for 4% of companies so far this year compared to 12% last year.

Best practice becomes the norm
Companies continue to favour the traditional combination of an annual incentive plan and a performance share plan, with few adopting alternative approaches to pay, such as the use of restricted share awards. Instead, companies have amended their existing structures to meet demands from investors.

For example, FTSE 100 companies have responded to investor calls for remuneration to be deferred over a longer period of time. In 60% of performance share plans analysed by Deloitte, no shares will be released to directors until five years after the awards are granted. This compares to 42% of plans in 2016 and 26% in 2015.

One in three of the companies included in the analysis have increased shareholding guidelines for at least one executive director, responding to investors’ expectation that directors build and maintain significant shareholdings in the companies they run.

Cahill explained: “Market practice has changed in the three years since remuneration policies were first approved, with executives expected to have more ‘skin in the game’ than in the past. Many companies have therefore taken the opportunity to incorporate higher shareholding guidelines and longer holding periods on performance share plans as part of the policy renewal.”

Restraint on pay
Around twenty per cent of companies have disclosed that the remuneration committee exercised its discretion to reduce bonuses awarded to executives in order to reflect overall performance or a specific incident.

Bonus pay-outs so far are slightly lower than last year (the median pay-out is currently 70% of the maximum that could be paid compared with 77% last year), while more executive directors will receive a salary increase in 2017 than in 2016 (80% in 2017 compared to 70% in 2016). The median salary increase is 2%, with most increases for executive directors being in line with increases received by the wider workforce.

Cahill commented: “Remuneration committees are acutely aware that pay outcomes need to be reflective of wider company performance and should be adjusted if necessary. On the whole, this year has been characterised by remuneration committees taking a more restrained approach and this has certainly played a part in ensuring such high levels of support from shareholders.”


Notes to editors

  • Deloitte analysed outcomes from 60 AGMs between January and June 2017. The report can be found here
  • Deloitte will publish more detailed reports of directors remuneration in FTSE 100 and FTSE 250 companies, providing detailed analyses of basic salary, salary increase, annual bonus payments and various other aspects of remuneration policy, later this year.

About Deloitte
In this press release references to “Deloitte” are references to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”) a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see for a detailed description of the legal structure of DTTL and its member firms.

Deloitte LLP is a subsidiary of Deloitte NWE LLP, which is a member firm of DTTL, and is among the UK's leading professional services firms.

The information contained in this press release is correct at the time of going to press.

For more information, please visit

Member of Deloitte Touche Tohmatsu Limited.

Did you find this useful?