AstraZeneca chief’s huge payday provokes investor revolt despite stellar record at UK drugs giant

High earner: AstraZeneca boss Pascal Soriot

AstraZeneca’s chief executive is in line to become the FTSE 100’s first £150 million boss.

The drugs giant is asking its shareholders to approve a performance-based pay policy that could hand Pascal Soriot rewards of up to £18.7 million this year.

That would take his total earnings to £153 million since he took over in 2012. To date, the businessman has been paid more than £135 million.

Soriot, 64, is widely hailed for reviving the fortunes of one of Britain’s biggest drug companies and providing millions with a life-saving Covid-19 vaccine.

He also fought off an unwanted takeover bid from US rival Pfizer. However, some investors are bridling at the size of his pay and bonus package.

The French-Australian executive faces a battle to win the support of investors for his bumper earnings.

Two influential shareholder advisory groups, Glass Lewis and ISS, are urging investors to vote against pay plan at the annual meeting this week, branding it ‘excessive’. Under the proposal, Soriot (pictured) could earn a bonus worth up to 300 per cent of his nearly £1.5 million base salary plus performance-related share awards worth up to 850 per cent of base pay. This is an increase on the previous pay deal , which permitted a 250 per cent bonus and awards worth 650 per cent of his base salary.

AstraZeneca has argued that the increase is ‘necessary to increase the competitiveness’ of the business compared with its rivals in the US and Europe.

Soriot has complained in the past about being underpaid compared with other global pharmaceutical bosses.

But Glass Lewis says there is an ‘absence of compelling evidence’ that the AstraZeneca boss is underpaid.

Emma Walmsley, chief executive of UK rival GSK, was paid £12.7 million last year compared with Soriot’s £16.9 million. Albert Bourla, head of Pfizer, took home £17 million.

Europe’s largest drugs group, Danish firm Novo Nordisk, maker of weight-loss drug Ozempic, paid its boss Lars Fruergaard Jørgensen £7.8 million.

One of the top earners worldwide in the drug sector is David Ricks, boss of Eli Lilly, who was paid £21 million in 2023.

Leading business figures in the City, including Julia Hoggett, head of the London Stock Exchange Group, are pushing for executives to receive higher salaries. Hoggett called for a ‘constructive discussion’ around executive pay, saying that Britain needed to attract top talent and discourage firms from decamping overseas.

Soriot’s pay has stirred controversy with shareholders in the past. Nearly 40 per cent of votes cast at AstraZeneca’s 2021 shareholder meeting were against its pay plan, which is set every three years.

Companies where more than 20 per cent of shareholders vote against bosses’ pay are put onto a ‘list of shame’, which is compiled by trade body, The Investment Association.

‘Given the concern that’s previously been expressed about the extreme levels of executive pay at AstraZeneca, it’s disappointing that the company has opted to give its chief executive an even higher pay package,’ said Andrew Speke of think-tank, the High Pay Centre.

He added that no chief executive ‘deserves to be paid over 500 times the typical UK worker’.

AstraZeneca investors may be minded to reward Soriot for his stellar record at the drugs giant.

He has had one of the most successful careers in British corporate history, spearheading the development of one of the first Covid-19 vaccines and repelling Pfizer’s hostile takeover bid in 2014.

Under his leadership, AstraZeneca’s market value has more than tripled to £164 billion, putting it ahead of HSBC and second only to Shell on the London Stock Exchange.

Astra now has a market value higher than its one-time suitor Pfizer, at £120 billion.

This post first appeared on Dailymail.co.uk