William Hill CEO's 9 Percent Raise Slammed by ISS Advisory Group

(Bloomberg) -- A 9.1 percent pay increase for new William Hill Plc Chief Executive Officer Philip Bowcock threatens to spark a shareholder rebellion at the U.K. bookmaking group.

Institutional Shareholder Services Inc., the advisory group that normally commands as much as 25 percent of shareholder support for its resolutions ahead of company annual general meetings, has advised William Hill investors to vote against the company’s remuneration report at its coming annual meeting.

Bowcock’s total pay, including benefits in kind, bonus and pensions, comes to 1.3 million pounds ($1.9 million) with the raise. ISS made the recommendation because of “concerns over the CEO’s significant salary increase,” according to a report to clients.

Executive pay has come under intense scrutiny in the U.K. ever since Prime Minister Theresa May called for the pay ratio between business chiefs and their employees to be narrowed in her campaign to take over from predecessor David Cameron. Investors have been vigilant, and a number of bosses such as WPP Plc’s Martin Sorrell have seen reductions.

Timing Faulted

Bowcock’s raise this year is the first at the company’s CEO position since 2014, and is “in line with the company’s wider employee pay increases over that period,” a William Hill spokesman said in an email.

Bowcock joined William Hill as financial chief four years ago and became interim CEO in 2016. He took on the permanent position the following year, when he received an increase to match his predecessor’s pay. The additional raise should have waited until Bowcock had proven himself in his current role, ISS said.

The new CEO assumed his duties during a time of “significant change,” William Hill said in response to ISS’s report. Domestic regulatory challenges, the potential opening up of U.S. markets and the review of the company’s Australian business that was sold to CrownBet Holdings all contributed to the complexity of Bowcock’s duties, according to a statement. William Hill is building a presence in the U.S., taking in about 30 percent of Nevada’s $250 million annual sports-betting revenue.

Under new procedures, any resolutions that 20 percent or more of a company’s shareholders vote against must be listed in an online register maintained by the Investment Association, the body that represents the British investment industry. The aim of the register is to highlight unpopular resolutions. Gold producer Centamin Plc, self-storage provider Safestore Holdings Plc, munitions maker Chemring Group Plc and property website operator ZPG Plc have all faced shareholder discontent over executive pay this year.

To contact the reporter on this story: David Hellier in London at dhellier@bloomberg.net.

To contact the editors responsible for this story: Aaron Kirchfeld at akirchfeld@bloomberg.net, John Lauerman, John J. Edwards III

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