--Legal & General Investment Management plans to escalate vote position on concerns over pay package

--LGIM plans to vote against re-election of Cineworld's chair and members of remuneration committee

--Asset manager said it is concern by Cineworld's lack of response

 

By Adria Calatayud

 

Legal & General Group PLC's investment-management arm plans to vote against Cineworld Group PLC's chairwoman's re-election and against all members of the board's remuneration committee due to concerns over its incentive plan.

"We have strong concerns about the structure of the long-term incentive plan granted to the executives, and its misalignment with the long-term interests of the company, its shareholders and other stakeholders," Legal & General Investment Management said in a blog post published Thursday.

"In particular, we note the impact of Covid-19 on the company's financials and stakeholders, including furloughs for employees and the suspension of dividends. We also take into account the current social sensitivities around income inequality," LGIM said.

The London-based asset manager said it would vote against resolutions to re-elect Cineworld Chairwoman Alicja Kornasiewicz as director at the company's annual general meeting due to be held on Wednesday. LGIM also said it would oppose the re-election of Dean Moore, chair of the remuneration committee, and Camela Galano, member of the committee, and the election of Ashley Steel as director, member of the remuneration committee.

Cineworld declined to comment on Friday. In its AGM circular, the company--the owner of U.S. cinema chain Regal--said its board believes the proposed resolutions are in the best interests of shareholders and the company as a whole and recommended that shareholders vote in favor of them.

LGIM said it had chosen to escalate its vote position as it was concerned by the lack of response from the company's remuneration committee and board despite significant opposition from shareholders to its pay proposals.

LGIM said it already raised concerns about Cineworld's pay package at a special shareholder meeting held in January. At that meeting, two remuneration resolutions were approved despite significant minority opposition.

Proxy advisers Glass Lewis and Institutional Shareholder Services recommended that shareholders oppose Cineworld's remuneration proposals at the January meeting, and said the awards contemplated by the company's incentive plan were "excessive."

 

Write to Adria Calatayud at adria.calatayud@dowjones.com

 

(END) Dow Jones Newswires

May 07, 2021 02:51 ET (06:51 GMT)

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