Trinity Mirror chief executive Sly Bailey has narrowly survived a shareholder revolt over her pay, after just 54% of shareholders voted to approve the remuneration report at the annual general meeting on Thursday.
The large number of voters who rejected the report follows a rebellion by major shareholders, who are unhappy with her £1.7m pay packet and the financial performance of the company. It comes in the wake of Bailey announcing she is to step down from the Daily Mirror publisher at the end of the year.
A source said that the rebellion is a “massive smack on the wrist” and a “warning shot” from investors, although if the report had been rejected it is highly unlikely company directors would have had to return any of their pay.
Investors voted to vent their mounting displeasure after a decade under Bailey’s leadership, during which the publisher’s market capitalisation has slumped from more than £1bn to £80m, and share price has fallen by over 90% to 30p. During that period, Bailey has pocketed more than £14m.
The lack of confidence in the structure of pay and bonuses at the publisher will put pressure on Jane Lighting, the former chief executive of Channel 5, who heads the remuneration committee at Trinity Mirror. However a spokesman said she will not stand down from the position.
More than 80% of shareholders voted to re-elect Lighting as a non-executive director, while over 85% voted in favour of reappointing Bailey for the rest of the year until a new chief executive is found.
Almost a quarter of shareholders voted against Trinity Mirror’s long-term incentive plan, which outgoing chairman Sir Ian Gibson said was being reviewed and may be adjusted to include targets such as achieving digital strategy goals.
Speaking after the AGM, David Grigson, the former Reuters finance chief who will take over from Gibson on 3 August, hinted at more board changes over the next year and said that Bailey’s successor will be “paid differently”, with more of a focus on performance targets.
Shareholders bombarded Gibson with questions and criticisms on how the company had operated since Bailey became chief executive.
“It has been a strategy of despair rather than success and achievement,” said shareholder Chris Morley, who is also a member of the National Union of Journalists. “Ever since she came in we have had year after year of cuts – and not always when the economy was bad – tens of millions of pounds of cuts and lots of good quality journalists, which has left the business weaker.”
He called on the board to bring in a new chief executive who would “grow the business rather than cutting it into a thousand pieces”.
Gibson, however, argued that the company is not in “crisis” and is performing better than many “privately-owned” rivals. He said Bailey had delivered on the strategy required in the economic climate, backed by the company board.
Bailey was not required to field any questions and disappeared immediately after her last annual general meeting.
Another shareholder said “I’ve been coming to this [AGM] all the time, I’ve got no confidence in the board, all I can say is you’re all fired.”
However Gibson said: “She has consistently delivered robust profits and cashflows and importantly set the digital basis for the group going forward.
He denied a news report that Bailey had been awarded a £1m pay-off. “We asked for that to be corrected, she is not getting a pay off she is working her notice.”
He pointed out that since Bailey joined the Daily Mirror’s publisher from IPC Media in 2003 she has had to manage the “worst and longest economic downturn this country has ever seen”.
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