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‘Massively underpaid’ AstraZeneca boss bags £18.7m pay deal

Advisory firms called on shareholders to reject a pay package ‘unprecedented’ among FTSE companies

AstraZeneca chief executive Pascal Soriot. In his defence, he can point to AstraZeneca’s transformation during his 12-year tenure, as evidenced by its shares trouncing the FTSE 100. Photograph: Justin Tallis/WPA Pool/Getty Images

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Proinsias O'Mahony
Sun Apr 14 2024 - 07:00

Can you be “massively underpaid” if you’re earning £16.9 million (€19.8 million) per year?

Yes, according to AstraZeneca shareholder Rajiv Jain, who told the Financial Times before the company’s annual general meeting that there was a “compensation issue” at the company and that chief executive Pascal Soriot deserved his proposed £1.8 million pay rise. It was passed on Thursday by shareholders, bringing his remuneration to £18.7 million

Soriot is “massively underpaid”, said Jain, “given AstraZeneca’s impressive turnaround since he joined more than a decade ago.” Unsurprisingly, others disagreed, with advisory firms Institutional Shareholder Services (ISS) and Glass Lewis calling on shareholders to reject the pay package.

ISS described Soriot’s compensation as “unprecedented” among FTSE companies, saying the latest hike “further widens” the pay gap with FTSE peers. Soriot’s pay has long been controversial.

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In 2021, 40 per cent of shareholders voted against an increased pay package awarded in the face of negative headlines regarding AstraZeneca’s Covid-19 vaccine roll-out. Nevertheless, shareholders ultimately approved Soriot’s latest pay deal.

Announcing a large dividend increase hours before the vote presumably helped, with Hargreaves Lansdown describing it as a “barely disguised sweetener”.

In Soriot’s defence, he can point to AstraZeneca’s transformation during his 12-year tenure, as evidenced by its shares trouncing the FTSE 100. Supporters also say comparisons with other FTSE companies are misguided, with Soriot earning less than some of his American counterparts.

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Still, Soriot is the highest-paid pharmaceutical boss in Europe. He earns more than twice that of Lars Fruergaard Jørgensen, chief executive at Europe’s most-valuable company, Novo Nordisk. He has pocketed £135 million during his time at AstraZeneca. “Massively underpaid” may be a slight overstatement.

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