Vodafone pauses bonus targets for CEO amid Covid turmoil

JIM ARMITAGE
REUTERS

Vodafone today said it would be delaying setting bonus targets for its top executives until it gets a better picture of the telecoms market and share prices.

The telecoms giant, which paid chief executive Nick Read £3.7 million last year - his first full year in the job - is waiting until November before deciding on his share awards grant for the following three years.

Like other big companies, Vodafone has been concerned about setting share awards at bombed out prices now which could end up paying exorbitant sums if the stock market picks up due to little real achievement by its executive team.

The so-called GLTI award sets aside a pot of shares the executive can receive in three years' time if they hit certain performance criteria. Executives are given an amount of shares by their financial value at the start of the scheme, based on a proportion of salary. Instead of setting the pot now, Voda will wait six months to give the stock market longer to settle.

Last year's GLTI was awarded to Read just after he had cut the dividend, hammering the share price, so he voluntarily sacrificed 20% of the shares he could get.

In addition to the GLTI, Vodafone has removed the revenues target on his one-year bonus, meaning it will instead be judged on cashflow and other elements over which management can have more control during covid.