Published May 22, 2012
Tesco boss Philip Clarke has opted not to take an annual bonus of about 372,000 pounds ($588,000) following a poor performance by the world's third-biggest retailer in its main British market.
Shares in Tesco, which issued a shock profit warning in January, have lost almost a quarter of their value this year and the company is now investing about 1 billion pounds in a bid to stem a declining market share in Britain.
A statement on Tesco's website on Tuesday, to coincide with the publication of the retailer's annual report, said its top 5,000 managers would receive a reduced annual bonus representing 16.9 percent of their maximum entitlement.
Executive directors will receive 13.5 percent of the maximum.
"I decided at the beginning of the year that I would decline my annual bonus for 2012," Clarke said in a statement emailed to Reuters.
"I wasn't satisfied with the performance in the UK and I won't take the bonus. I'm confident that we're tackling the right issues."
Clarke, a former Tesco shelf stacker, would have been entitled to a payout of about 372,000 pounds had he taken the 13.5 percent being paid to other executive directors.
The Tesco chief executive's decision comes amidst a round of high profile shareholder revolts over remuneration at companies like Barclays <BARC.L>, Inmarsat <ISA.L> and Prudential <PRU.L> in a phenomenon dubbed the "shareholder spring".
Increasing investor resistance to executive pay rises at underperforming firms has also led Aviva <AV.L> boss Andrew Moss, and Sly Bailey, head of newspaper group Trinity Mirror <TNI.L>, to quit this month.
In March, Clarke jettisoned the head of Tesco's UK operation, assumed his duties and is now directly in the firing line if his plans fail to halt a slide in sales.
Tesco shares were broadly flat at 5:35 a.m. EDT (0935 GMT) at 309.85 pence.