Backlash over Boohoo’s ‘growth share plan’ which will see bosses hand over £175m if the share price improves
Boohoo has suffered a bloody nose over a controversial plan to hand bosses £175m if its share price improves.
The struggling fast fashion company’s ‘growth stock plan’ has infuriated investors, with nearly four in 10 voting to reject it yesterday.
Despite the backlash, Boohoo will continue with the program, the third bonus plan for senior executives to roll out in four years.
Boohoo’s ‘growth share plan’ could hand chief executive John Lyttle £50m, chief financial officer Shaun McCabe £25m and co-founder Carol Kane (pictured) £20m
Two previous plans fell through after the company’s share price plummeted, meaning ambitious goals were missed.
The latest scheme could give Boohoo boss John Lyttle £50m, finance boss Shaun McCabe £25m and co-founder Carol Kane £20m.
Samir Kamani, who runs the company’s Boohoo Man brand and is the youngest son of Kane co-founder Mahmud Kamani, could receive £12.5million.
The rest of the £175m pot would go to company staff.
But to unlock the huge payouts, bosses will have to bring Boohoo’s share price back from all-time lows and hit a series of targets over the next five years.
The end goal that would see all £175m paid out is for Boohoo’s value – currently around £690m – to exceed £5bn for a period of over 90 days.
Kamani, executive chairman of Boohoo, “wholeheartedly” endorsed the plan despite the backlash.
And Chairman Iain McDonald said it would “resolutely align” the interests of bosses with those of shareholders.
But Luke Hildyard of the High Pay Center said potential payments under the scheme were “free”.
He said the vote against the bonus by so many independent shareholders “is conclusive evidence of excess”.
Boohoo shares fell 1.3%, or 0.74p, to 54.6p yesterday.
