Nationwide directors faced a barrage of criticism from angry members over their pay yesterday at the building society’s annual general meeting.
Members were invited to pitch questions to the board during the meeting, with many using the opportunity to challenge the directors’ salaries for the coming year.
In 2010/11 chief executive Graham Beale and group distribution director Matthew Wyles – who were both re-elected at yesterday’s meeting – will earn a basic salary of £650,000 and £350,000 respectively. In 2009/10, one director, group development director Tony Prestedge, received a bonus that was 63.9 per cent of his basic salary.
One member said: “As far as I know, our directors are well qualified, experienced, dedicated, hard-working and doing a difficult, responsible job well. They therefore deserve to be well paid.
“Many members of the society could make similar claims about the jobs that they do. Not only are they paid less than our directors, they are paid very much less. In many cases, they will not earn in a lifetime what our directors earn in a year.”
Another member said: “Why don’t the board members show thought to those who do not have as much as them, by giving their extreme wealth to sustain the less well off in employment, and thus serve the members better.
Building Societies Members Association honorary secretary Alan Debenham said: “We are not in the business of making people filthy rich. I do not mind making people rich, but making them filthy rich is not the business of a mutual society.”
Nationwide chairman Geoffrey Howe said cutting director pay would put the society at risk.
He said: “It comes down to this – do we think that the action of making a reduction to the remuneration of senior team of nationwide is an action plan of material consequence? If you believed that you would do it.
“But I have to tell you, ladies and gentlemen, we simply do not believe it. It would put this organisation at risk – and that is a step which I am afraid that my colleagues, my non-executive colleagues who deal with director remuneration, are not willing to take.”
Despite the number of questions put to the board over its pay for the coming year, the remuneration report was passed with 921,132 votes for the proposal and 62,549 votes against.
Members also voted for all four directors up for re-election – Matthew Wyles, Mark Rennison, Chris Rhodes and Graham Beale – to continue in their roles.
Executive director David Rigney stood down from the Board, as planned, on 21 July 2010 and non-executive directors Stella David and Derek Ross retired from the Board on 22 July 2010, having completed their full terms on the Board.