Boohoo narrowly approves new growth plan

Boohoo has experienced pushback from shareholders over its plans to award executives £175m if its share price improves, despite the scheme’s narrow approval at its general meeting on 8 March. 

The fast fashion retailer’s growth plan saw 37% of the group’s shareholders voting to reject the plan. As a majority voted for, it is set to go ahead, making it the third bonus plan to be implemented in four years. 

However, this would mean that the group’s bosses will have to hit a series of targets and raise its share price over the next five years. The last two previous plans had failed after the retailer’s share price dropped. 

If successful, Boohoo chief executive John Lyttle would be awarded £50m, while finance boss Shaun McCabe would receive £25m and co-founder Carol Kane £20m. 

Meanwhile Boohoo Man boss Samir Kamani could receive £12.5m, with the rest of the £175m set to go to staff. 

Iain McDonald, chairman of the remuneration committee at Boohoo, said: “The growth plan was designed with an intention to rebuild substantial shareholder value through the delivery of extremely ambitious targets, and it acts as a powerful retention, recruitment and incentivisation tool for all participants, resolutely aligning their interests with those of our shareholders. 

“We followed a detailed consultation exercise with a number of our larger shareholders and we thank all of them very much for their engagement and contributions.”

Mahmud Kamani, executive chairman of Boohoo, said: “As Boohoo’s largest shareholder I wholeheartedly endorsed the growth plan, recognising the importance of aligning the interests of all shareholders with those of our hardworking boohoo colleagues. 

“The value generated for shareholders would be some 25 times greater than the maximum award of the plan, and I am therefore pleased that it is being implemented.”