Ocado boss Tim Steiner has collected nearly £100 million in pay since the online grocery company floated on the stock market in 2010, even as its share price now languishes below its flotation level, according to an analysis by the High Pay Centre. The figure raises serious concerns about proportionality, accountability and fairness in the pay-setting process, campaigners said.
Steiner's Compensation Package
Analysis of Ocado reports by the High Pay Centre showed that Steiner, a former Goldman Sachs trader who co-founded the British technology company in 2000, has received £94 million in payouts. This includes share awards whose value is likely to have changed over time. His payouts included nearly £59 million in 2019, largely driven by a string of deals to sell its grocery-picking technology to foreign supermarkets.
Paddy Goffey, head of research at the High Pay Centre, stated: "Tim Steiner's pay trajectory illustrates a broader problem in the UK's broken executive pay framework: compensation is increasingly shaped by sporadic, outsized awards, rather than being linked to genuine performance. The £59 million figure in 2019 reveals how incentive structures can create extreme spikes in pay that are hard to reconcile with company performance or improvements in the working conditions and pay of employees. This raises serious concerns about proportionality, accountability and fairness in the pay-setting process."
Succession Planning and Share Price Woes
Steiner is thought to be in discussions over his future after it emerged that Ocado had approached at least one potential replacement. Sky News reported that the board had approached Niklas Heuveldop, the chief executive of Vonage, part of the Swedish telecoms group Ericsson. It is unclear whether Heuveldop is a preferred candidate or how advanced the succession planning is.
Ocado said earlier this week: "The chief executive and the board continually engage in long-term succession planning and regularly engage with potential candidates." Sources close to Ocado indicated that the process was likely launched by relatively new chair Adam Warby, appointed in December 2024, who previously chaired headhunter Heidrick & Struggles for five years. The sources believed the search had been initiated quietly without consulting Steiner, as Warby felt pressure to act amid the slump in Ocado's share price.
Shares in Ocado fell this week on reports of Steiner's potential exit, sinking to as low as 172p, short of the 2010 float price of 180p. Ocado has more shares in issue today than in 2010, and the company is worth about £1.4 billion compared with £720 million at flotation, but the new issues have diluted many early shareholders' stakes. The shares have fallen more than 90% in the past five years, having hit almost £28 during the Covid pandemic.
Business Challenges and Shareholder Sentiment
During the pandemic, Steiner suggested households were permanently shifting to buying groceries online, but that optimism proved short-lived. Kroger, a major US partner, announced last November it was closing three warehouses using Ocado's equipment. Two months later, Canadian partner Sobeys closed its Calgary facility. Steiner admitted this year: "The market for large automated distribution centres in the US is smaller than we thought it would be."
Clive Black, an analyst at Shore Capital, said a plan to oust Steiner "wouldn't be wholly unfathomable given the share price and how much he pays himself." Shore noted that Ocado's returns on invested capital were poor and it had "barely made a profit" in its entire existence. However, Black acknowledged that Steiner had "single-handedly overseen the creation of a FTSE 100 business in Ocado" and those who invested and sold shares at the right time had made substantial gains.
Some large shareholders, such as Jörn Rausing, who controls a 10% stake and sits on Ocado's board, are thought to be supportive. Records indicate Rausing increased his stake with £5.4 million more shares in March. No main shareholders approached by the Guardian were prepared to speak publicly for or against Steiner. The Financial Times reported that several top 10 shareholders had written to the board expressing support.
One Ocado insider said Steiner's exit would not be welcomed by senior managers, as the company was now seen to be "on the right track" in terms of tech development. They said "the majority back Tim. Going now could create extra problems internally. I think the pressure is coming from major shareholders." Ocado declined to comment.
