In a move to address shareholder concerns, UK fast-fashion retailer Boohoo has cancelled plans to pay £1 million bonuses to three of its top executives, including CEO John Lyttle and co-founders Carol Kane and Mahmud Kamani. The decision comes after shareholders voiced their disapproval over the proposed bonuses, particularly in light of the company’s £160 million loss for the financial year ended February 29.
Boohoo announced that the executive directors have opted to forgo their entire bonus entitlement for the most recent financial year. Mr. Lyttle’s salary has been reduced from £1.3 million in the previous year to £713,175 for the current year. The company’s annual report stated that the executives were not eligible for a bonus as financial targets had not been met.
Several shareholders had expressed their intention to vote against the planned bonuses at Boohoo’s upcoming annual general meeting (AGM). The company was also set to present a resolution regarding its incentive plan for shareholder approval. However, Boohoo has now decided to cancel the vote, citing engagement with certain shareholders and the decision not to implement the incentive plan at this time.
Boohoo had sought to modify its existing remuneration policy by merging the annual bonus scheme and long-term incentive plan into a single plan featuring a combination of time-based and performance-based awards. The company stated that it will consider further engagement with shareholders regarding the plan in the future.
John Lyttle, who hails from Offaly, Ireland, has served as Boohoo’s CEO since 2019. Prior to this role, he held the position of chief operating officer at Primark for eight years. The company’s co-founders, Carol Kane and Mahmud Kamani, also hold executive positions, with Ms. Kane as an executive director and Mr. Kamani as executive chairman.
The decision to scrap the planned bonuses demonstrates Boohoo’s responsiveness to shareholder concerns and its commitment to aligning executive compensation with the company’s financial performance and long-term sustainability. As Boohoo navigates the challenges faced by the fast-fashion industry, this move aims to foster trust and support from its shareholders.
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