Reckitt Benckiser, the consumer goods giant behind brands like Durex and Nurofen, is facing intense scrutiny after approving a staggering £55 million pay package for its CEO, Kris Licht, while simultaneously implementing cost-cutting measures that include job losses and wage freezes for employees.
Shareholders Express Outrage
At the company's annual general meeting, nearly 20% of shareholders voted against the remuneration report, a significant protest in the corporate world. Major investors, including Legal & General Investment Management and Royal London Asset Management, publicly criticised the pay deal as "excessive" and "misaligned" with the company's performance.
Workforce Cuts Amid Executive Rewards
The controversy comes as Reckitt:
- Announced plans to cut 1,300 jobs globally
- Froze pay for many employees
- Reported a 15% decline in operating profits
"This is corporate greed at its worst," said one anonymous employee. "They're taking away our livelihoods while the boss gets richer."
Company Defends Compensation
Reckitt's board argued that Licht's package, which includes performance-related shares, is necessary to retain top talent and reflects the complexity of leading a £32 billion multinational. The company stated: "Our remuneration policy is designed to drive long-term sustainable growth and align executive interests with shareholders."
Broader Trend in Executive Pay
This controversy highlights the growing divide between:
- Soaring executive compensation
- Stagnant worker wages
- Increasing shareholder activism on pay issues
Analysts suggest the backlash may prompt Reckitt to reconsider its compensation strategy ahead of next year's AGM.
