Wolseley Shareholders Should Vote Against Pay Report, PIRC Says

Shareholders of Wolseley Plc, the world’s largest supplier of heating and plumbing products, should vote against the company’s executive pay report, according to the Pensions & Investment Research Consultants Ltd.

“Maximum aggregate awards are capped at more than five times the chief executive’s salary, and actual awards granted during the year are also excessive in our view,” London-based PIRC wrote in a note to clients today. “Salaries rank at the top of the sector.”

The investor advisory service said the payments made to former directors Rob Marchbank and Steve Webster need to be explained. Wolseley, which has management offices near Reading, England, is scheduled to hold its annual general meeting on Jan. 20.

Chief Executive Officer Ian Meakins was paid a salary of 775,000 pounds ($1.2 million) and total compensation of 1.94 million pounds for the fiscal year ended in July 2010, according to the company’s annual report.

Marchbank, CEO of the European unit until March, received compensation of 1.13 million pounds, including 358,200 pounds in salary, and Webster, who stepped down as chief financial officer in March, received 1.6 million pounds, including 370,800 pounds in salary. Marchbank and Webster received 321,800 pounds and 870,500 pounds, respectively, as "compensation for loss of office."

Executive directors’ "target salary is set at mid-market, with the opportunity to go above this level if there is sustained individual high performance," Wolseley said in the annual report’s section on pay. Bonuses "at the upper end of the range" were approved because the company "delivered against challenging financial objectives," according to the report.

To contact the reporter on this story: Howard Mustoe in London at hmustoe@bloomberg.net.

To contact the editors responsible for this story: Colin Keatinge at ckeatinge@bloomberg.net.

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