Feb. 13--The City grandee who sanctioned the latest bonus bonanza at Barclays is facing calls to quit.
Furious shareholders and business groups have slammed the head of Barclays' remuneration committee, Sir John Sunderland, as well as its chairman, Sir David Walker, for rubber stamping the bumper increase in pay-outs.
The scandal-hit lender revealed on Tuesday that it had hiked its bonuses by 10pc to pounds sterling 2.38bn, with investment bankers receiving a 13pc increase to pounds sterling 1.57bn – or pounds sterling 60,100 each on average.
This came despite a 32pc fall in profits to pounds sterling 5.2bn last year, and a sharp fall in profits at the investment bank.
Chief executive Antony Jenkins has been fending off criticism ever since. Shareholder group PIRC and the Institute of Directors said the hefty pay rise raised doubts about the independence of the former Cadbury Schweppes boss, who has been a non-executive director at Barclays for nine years.
It suggested that Sunderland, currently chairman of London Eye owner Merlin Entertainments, be replaced by fellow non-executive director and former Legal & General boss Tim Breedon.
Boardroom guidelines recommend that all members of remuneration committees which sanction pay and bonuses should be independent so that they can stand up to company bosses's demands for higher pay. The UK Corporate Governance Code stipulates that when members serve for longer than nine years they lose that independence.
PIRC said the latest bonus round at the bank reinforces its view that Sunderland should not be re-elected. Sunderland stunned the banking standards commission last year when he said he remained convinced that Bob Diamond – who was forced to quit as CEO in 2012 after the bank was fined pounds sterling 290m for rigging Libor – deserved his pounds sterling 2.7m annual bonus for 2011.
Sunderland proved to be more amenable than his predecessor Alison Carnwath, who claimed she has been a 'lone voice' in recommending that Diamond receive 'zero bonus'. Carnwath quit in 2012 and was replaced by Sunderland, who was part of the remuneration committee that approved Diamond's bonus.
A PIRC spokesman said: 'Given the problems highlighted by outgoing director Alison Carnwath, PIRC did not support the re-election of Sir John Sunderland, the Remuneration Committee chair, last year, and taking into consideration the current poor decisions over remuneration and bonuses, PIRC will again be opposing his re-election this year.'
The IoD added that re-electing Sunderland will 'risk inviting further questions about just how sensitive they are to the public's mood and expectations'. Barclays chairman Sir David Walker – a fellow member of the remuneration committee – was also criticised. Walker has promised to clean up the bank and curb its high rolling pay culture since taking the helm in 2012.
The PIRC spokesman said: 'Sir David Walker, started well beginning to address the criticisms of the culture of the past. But very little seems to have changed.'
Six more people will be charged by the Serious Fraud Office in connection with its investigation into the rigging of Libor interest rates. The SFO has already charged three, including former Citigroup and UBS trader Tom Hayes. He and two brokers from RP Martin will stand trial next year.
(c)2014 Daily Mail (London, )
Visit the Daily Mail (London, ) at www.dailymail.co.uk/home/index.html
Distributed by MCT Information Services