Unilever Shareholders' Ire at Ex-Chairman's Payout

13 May 2005

Questioned by an irate Unilever shareholder as to why former chairman Niall FitzGerald "left with a payoff [when] he is described as having resigned", ceo Patrick Cescau delivered a wondrously weaselly reply.

"It was," said the French-born ceo in tones reminiscent of oiled silk, "a negotiated departure … that's the beauty of the English language."

His response at Wednesday's annual meeting failed to impress a substantial number of shareholders, over one third of whom voted against Unilever's annual remuneration report. This revealed that the sacked chairman's annual handout totalled £3.74 million ($7.01m; €5.47m) - of which £1.22m was compensation for loss of office.

Many investors and analysts are outraged at such a reward for presiding over the failure of the group's much-vaunted Path to Growth, which set aggressive sales growth targets while decimating the group's 1,600-strong brand portfolio to just four hundred lines. It was described by one stockholder as "a pig's breakfast".

Fitzgerald's reign also marked a long period of revenue growth stagnation and falling profits. In the final quarter of 2004 the group made a loss of €519 million.

Shareholders criticised the level of directors' and non-executives' pay compared alongside the group's share price performance. One angered investor told the meeting: "Mediocre results I think deserve mediocre payment."

Nonetheless, a desire not to rock the recently refloated boat saw Unilever's remuneration report adopted by 1.08 billion votes to 149.2 million.

Data sourced from Telegraph.co.uk; additional content by WARC staff