Tesco investors reject chief’s £6.4m pay deal

Tesco shareholders inflicted one of the biggest-ever FTSE 100 pay revolts on the supermarket group yesterday. 

More than 67 per cent of investors voted against the £6.4m package for departing boss Dave Lewis – a stinging parting shot to the executive dubbed ‘the bloke who saved Tesco’ after he turned around Britain’s biggest supermarket. 

Shareholders were outraged that online grocer Ocado had been removed from a list of rivals used to assess Lewis’s performance. 

The move boosted the payout for his long-term bonus from £800,000 to £2.4m. 

Yesterday Tesco’s board were accused of being ‘completely out of step’ with the views of shareholders. The vote will sit alongside other historic shareholder revolts including the 70 per cent vote against Royal Mail boss Rico Back’s pay in 2019 and the 90 per cent vote against shamed banker Fred ‘The Shred’ Goodwin in 2009. 

Tesco also reported an 8 per cent increase in sales to £13.4billion in the three months to May, thanks to the lockdown, but said profits would remain flat due to rising costs. It launched a price war against the discounters amidst fears the recession could drive shoppers to cheaper rivals. 

Ahead of yesterday’s annual general meeting, Tesco’s bosses had repeatedly defended the bonus in public with chairman John Allan saying it was ‘right and fair’. 

Luke Hildyard, of the High Pay Centre, said: ‘Moving the goalposts so blatantly to help the chief executive plunder more money at a moment of national economic crisis shows the Tesco board must be completely out of step.’ 

But the vote is not binding and Lewis has so far refused to hand back his bonus. 

The retail supremo brought the supermarket back to profit from a £6.4billion loss in 2014. Once nicknamed ‘Drastic Dave’ for brutal cuts at Unilever, he told investors Tesco’s turnaround was ‘complete’ when he announced his departure last October. 

As the UK heads into a recession, Tesco extended its ‘Aldi price match’ offer to 500 products in a bid to try and protect its market share. Aldi and Lidl have chipped away at the major players’ market share over many years – and bosses are worried the trend will accelerate as families tighten their belts.