Santander shareholders urged to vote against Botín pay package

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Santander is facing a potential shareholder rebellion at its annual general meeting this month after influential proxy adviser ISS recommended that investors vote against executive chair Ana Botín’s pay package.

Botín is one of Europe’s highest-paid bank executives, having been awarded €12.2mn last year on the back of the Spanish lender achieving record profits thanks to rising interest rates. 

Santander has asked shareholders to approve a change to its pay policy whereby the salaries of both Botín and chief executive Héctor Grisi would increase by 5 per cent, adding to the 3 per cent increase in Botín’s fixed pay last year.

The Santander AGM is due to take place on March 22.

In ISS’s report on the bank’s AGM, sent to shareholders on Friday and seen by the Financial Times, the proxy adviser recommends investors vote against the company’s new remuneration plan over concerns about the way pay and performance are matched.

ISS said the board had tried to justify the increase in Botín’s pay by pointing to the group’s strong results and shareholder returns, as well as the need to stay competitive with rivals.

But ISS concluded: “The chair remuneration package seems far from being uncompetitive, and the proposed increase is likely to exacerbate recurring pay-for-performance concerns.

“For this reason, support to the new policy is not warranted.”

ISS backed the rest of the bank’s proposals for this year. It supported the pay plan last year.

Botín’s total pay rose 4.3 per cent last year, with her €12.2mn package made up of €7.4mn in cash and €4.8mn in gross profit on shares and other special payments. ISS’s complaint is targeted just at her fixed salary, which would rise from €3.27mn to €3.43mn.

Grisi, who earned a total of €6.8mn last year, would see his fixed salary increase from €3mn to €3.15mn under…