BT’s discretion on pay should reassure investors


Ashley Hamilton Claxton, Corporate Governance Manager

11 July 2017

We welcome the steps taken by the board to adjust executive pay following the accounting irregularities in BT’s Italian operations and the pay proposals have our full support this year. In particular, we are pleased that the board was willing to reduce the value of previous bonus payments in line with the restated financial results. This is a good example of a pay committee exercising appropriate use of discretion and will provide the reassurances that BT investors need following the accounting issues.
Although management has been swift to address the issues in the Italian business, we have abstained on the re-election of the auditors and the re-election of the Chairman of the Audit Committee to reflect our concerns about the governance and oversight of the audit.

We welcome the steps taken by the board to adjust executive pay following the accounting irregularities in BT’s Italian operations and the pay proposals have our full support this year. In particular, we are pleased that the board was willing to reduce the value of previous bonus payments in line with the restated financial results. This is a good example of a pay committee exercising appropriate use of discretion and will provide the reassurances that BT investors need following the accounting issues.

Although management has been swift to address the issues in the Italian business, we have abstained on the re-election of the auditors and the re-election of the Chairman of the Audit Committee to reflect our concerns about the governance and oversight of the audit.

The value of investments and the income from them is not guaranteed and may go down as well as up and investors may not get back the amount originally invested. The views expressed are the author’s own and do not constitute investment advice.