Unilever has frozen the salary of its new chief executive for the next two years after shareholders protested over its executive pay.
The FTSE 100 consumer goods group said Hein Schumacher’s €1.9 million pay, which is higher than the €1.6 million received by Alan Jope, his predecessor, would be reviewed again in 2026.
The pay freeze came after 58 per cent of Unilever shareholders rejected a resolution to adopt the company directors’ remuneration report at its annual meeting in May.
Unilever, whose brands include Vaseline skincare products and Ben & Jerry’s ice cream, said it had undertaken an “extensive engagement exercise” with 28 of its largest investors since the vote. It said the feedback “informed us that the primary reason for the limited support for the directors’ remuneration report was the approach taken to setting the incoming chief executive’s remuneration on appointment.”
The Anglo-Dutch company added that while the majority of shareholders agreed that the fixed pay level for Schumacher “appropriately reflected the size and complexity of the role, there was a preference that alignment with the market could have been achieved gradually, rather than in one step on appointment.
Advertisement
“This approach of restricting any increases over the first years of appointment is intended to reflect and align with shareholder views in the engagement process that market alignment should be achieved in two to three years following appointment.”
Schumacher, 52, a restructuring specialist who joined from FrieslandCampina, a Dutch dairy co-operative, took on the role in July. He set out a strategy last week to deliver faster growth and productivity, as well as an overhaul of the leadership team, after Unilever reported a 3.8 per cent fall in third-quarter turnover to €15.2 billion.
He said he would invest in Unilever’s “power” brands — 30 of its 400-plus labels that represent 70 per cent of the group’s turnover. They comprise 14 brands with €1 billion or more in revenue, including Dove, Sure and Persil, complemented by another 16 that have the potential to reach that figure.
Schumacher also rowed back on his predecessor’s strategy of “force-fitting” social justice messages on to brands. Jope, 59, had wanted to sell brands that “stand for something more important than just making your hair shiny, your skin soft, your clothes whiter or your food tastier”.
Shares in Unilever closed up 41½p, or 1.1 per cent, at £38.62½.
