Directors at Aim-listed Lighthouse refused at last week’s AGM to give any detail on the “challenging performance goals” that are set for the “superior performance” that triggers bonus payments. However, in a tense atmosphere at the meeting it was revealed that, of the many criteria, the executive directors had missed the profit target set.
It is the third consecutive year of reported losses, so maybe that is not surprising. The board failed to detail any objective tests set that justify a total board cost of £966,000 (coincidentally £966,000 in the previous year as well) which means almost £2m has been paid out in the last two years, almost half of the group’s current market capitalisation of £4.79m.
In a further exchange it was revealed that the remuneration committee had not actually spoken to a single shareholder to canvas opinion on the bonuses. In fact the group chairman Mr Richard Last said that subsequently they had not had a single word said against it.
This directly contradicts the statements of all the shareholders I have spoken to, representing over 30 per cent of the share register.
In the last ten years, total board remuneration including severance payments, is a staggering £10m while reported losses over that period total £15.3m.
Boards should not be able to reward themselves with bonuses and an increase in total pay (for the two executives of 39 per cent) over a period where shareholders have absolutely no return on their investment.
Simon Taylor-Young is a private investor and Lighthouse Group shareholder