Tesco’s new chief executive has said his bonus is under review as he tries to turn the ailing retailer around.
Dave Lewis told the Mail on Sunday pay deals for senior executives were under review as part of a shake-up of the business, which has been rocked by a £263m accounting black hole and a 92% drop in half-year profits.
In financial reports posted last week, it was revealed Britain’s biggest supermarket had also suffered worsening sales compared to its competitors and the poor results caused the share price to slump by 7%, wiping £1bn of its value.
Mr Lewis, who took over this month with a £1.25m basic salary and a £525,000 golden hello in lieu of his Unilever bonus, admitted the revelations had been “a body blow” and said outgoing chairman Richard Broadbent had asked him to look at executive bonuses.
“In fairness, one of the things that the chairman and remuneration committee are doing, and have asked me to look at, is reviewing what the long-term plan and long-term incentives should be,” he told the paper.
“If you are doing a turnaround then maybe you’d want some shorter-term targets for the leadership team.”
And he added the City regulator had ordered him to stop an internal investigation into the accounting error.
“The Financial Conduct Authority said they completely agreed on our focus on being able to report the number, but they didn’t want us to focus on the how. That was the investigation they would do,” he said.
He admitted he had had to find time to get to grips with the ins and outs of the business, including visiting stores, and he wanted to focus on the needs of the customer as shoppers now regularly looked to discount competitors such as Aldi and Lidl.