Lord MacLaurin, who steps down as chairman of Vodafone in July, could stay on in an advisory capacity to sidestep a clash with investors in the UK-based mobile phone operator over a planned £500,000 retirement bonus.
Vodafone is expected to confirm in its annual report this June that Lord MacLaurin’s contract entitles him to a payment about equal to his annual salary when he hands over the chairmanship to Sir John Bond, currently at HSBC.
Some shareholders are understood to have concerns about the payment, however. Retaining Lord MacLaurin in an advisory role would allow him to claim his golden goodbye was a remuneration for continuing service to the company without adding a corporate governance dispute to shareholders’ other grievances.
Reports of tension between him and Arun Sarin, Vodafone’s chief executive, have fuelled speculation in recent months that Lord MacLaurin could step down early. But with the new chairman, Sir John Bond, unable to start until July, investors questioned the logic behind an early departure.
However, keeping Lord MacLaurin on as a consultant could hamper Mr Sarin’s efforts to make a clean break with Vodafone’s past strategy.
In the past ten days Mr Sarin has announced a £23bn-£28bn writedown of goodwill associated with its 2000 acquisition of Mannesmann, and unveiled talks with Softbank to sell its Japanese telecoms business.
Verizon, its partner in Verizon Wireless, has also signalled it is now actively seeking to buy Vodafone’s stake in the US mobile joint venture, which is valued at up to $50bn.
The debate about Lord MacLaurin’s retirement comes amid intense scrutiny of the role played by Sir Christopher Gent, Mr Sarin’s predecessor.
Neither Sir Christopher nor the company has confirmed reports that he sought to interfere with the appointment of its finance director, but pressure is understood to be building for Sir Christopher to relinquish his honorary life presidency of the company by christmas.
Lord MacLaurin’s planned bonus, which was not disclosed in last year’s annual report, could reopen questions about remuneration at the company, following a dispute surrounding a bonus offered to Sir Christopher after the Mannesmann transaction.
One shareholder said yesterday it was best practice to link pay to performance, and queried whether a leaving bonus for Lord MacLaurin would comply with this principle.
But another said there had been many instances where companies had made bonus payments to departing directors with shareholders’ approval, but any payment above one times salary would be challenged.
x-ref Notebook, Lombard, AT&T coverage
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