TRG to keep remuneration policy ‘under active review’ after overcoming investor revolt

23-May-2023 - Last updated on 23-May-2023 at 15:54 GMT

The Restaurant Group (TRG) has said it will keep its remuneration policy ‘under active review’ after more than a third of investors voted against it at the group’s AGM.

A group of activist investors, led by the Hong Kong-based hedge fund Oasis Management, had been piling pressure on TRG in recent weeks, calling on the beleaguered casual dining chain's fellow shareholders to vote against its remuneration policy.

However, at TRG’s annual general meeting this afternoon (23 May), both the remuneration policy and remuneration report for 2022 passed having gained the approval of 65% and 54% of shareholders, respectively.

TRG, which operates the Wagamama, Frankie & Benny's and Chiquito restaurant brands, noted in its AGM report that ‘a significant minority’ did not support the remuneration resolutions, and pledged to keep the policy ‘under active review’ going forwards.

It said: “As set out in the Directors' Remuneration Report, the Remuneration Committee intends to keep the Remuneration Policy under active review to ensure it remains appropriate to the group's evolution and aligned to stakeholder interests and will provide an update on that review within the statutory six-month timescale.

“In particular, it will re-engage with our largest shareholders over the coming months as to whether the Restricted Share Plan should be replaced by some other form of long-term incentive plan in line with the preferences of some shareholders.”

Prior to the AGM, Oasis, which owns a 12.3% stake in TRG, had been calling for a strategic shake-up of group, including an overhaul of its current pay scheme, particularly with regard to chief executive Andy Hornby’s salary, which increased to £674,450 for 2023, up from £658,000 in 2022.

Other investors to call for change at the company include Coltrane Asset Management and the Irenic Capital Management, both of which suggested TRG dispose of its ‘non-core assets’ and focus its attention solely on owning and growing the Wagamama brand.

In contrast, Columbia Threadneedle Investments, a US-based asset management firm that holds around 19% of TRG’s shares and is understood to be the group’s largest investor, had thrown its support behind the business’s management team; as had Royal London Asset Management (RLAM).

At the AGM, Hornby and Hanna were both re-elected with 77% and 84% approval, respectively. Zoe Morgan, TRG’s non-executive director and chair of the Remuneration Committee, was also re-elected with 76% approval.

TRG noted the ‘significant votes’ against the re-election of Hanna and Morgan, but said it believes that a clear majority of shareholders support the current board and management team.

However, it added that it will continue to engage and consult with shareholders, including those who voted against the re-election resolutions.