Vodafone is consulting its leading shareholders on the pay package for Mr Arun Sarin, its incoming chief executive.

The telecommunications group, a veteran of past pay disputes, is understood to be proposing a package in line with the one agreed last year for Sir Christopher Gent, who retires in July. That package would make Mr Sarin one of Europe's highest paid executives. Some leading shareholders have indicated they might support the package.

"Given that it is an international company, the numbers will be sufficiently large for someone to take a pop at them if they want to. But we don't expect to have problems with it," said one top 10 shareholder.

"In some ways, it is encouraging that there has not been a ratcheting up of pay as you sometimes get when a new chief executive takes over." Another leading shareholder said the package was unlikely to generate the same controversy Vodafone experienced in 2000 and 2001 over Sir Christopher's pay.

In 2002, Vodafone sought to avoid a repeat by carrying out a special review of its pay policies led by Lord MacLaurin, its chairman, and Ms Penny Hughes, a member of the board's remuneration committee. It consulted shareholders widely.

This saw the mobile operator gain support for a complex new package for Sir Christopher including a basic annual salary of £1.2 million (€1.76 million) and performance pay and bonuses worth up to a further £3.9 million. He was also awarded 9.3 million share options. - (Financial Times Service)