Greencore boss defends pay levels

Greencore’s new chairman has defended the high executive pay levels at the food group by saying the business has to compete with its peers in order to retain top talent.

Gary Kennedy did not take over from outgoing chairman, Ned Sullivan until after yesterday’s AGM, but was called upon by irate shareholders for his view on the high remuneration packages and the comparison with other Irish companies.

In Greencore’s last financial year — covering the 12 months to the end of September — CEO Patrick Coveney saw his remuneration top £1.46m (€1.7m), while chief financial officer, Alan Williams, saw his jump from £463,000 to £813,000.

Mr Kennedy — a former finance director at AIB and a current director with Elan and IBRC — echoed the views of Mr Sullivan from earlier in the AGM, but he said Greencore’s peers were now international companies rather than just Irish plcs, and noted that Deloitte had been taken on to advise on remuneration trends.

Chairing his final AGM as Greencore chair, Mr Sullivan said remuneration was in line with company performance and it was “overwhelmingly in the interests of shareholders” that the group could compete for top executive talent.

Asked about dividend policy — the latest annual payout of 4.25p marked a near 25% increase on the previous year — Mr Sullivan said that it is, and will be, kept under review.

He said, however, that the company’s main focus remains on deleveraging.

Speaking after the AGM, Patrick Coveney dismissed claims from the Unite trade union that Greencore had breached promises to reverse pay cuts at one of its UK facilities, as “completely untrue”.

About 500 workers are due to strike this morning at Greencore’s cake-making facility in Hull over a pay dispute dating back to Oct 2011.

Unite claims that a combined £1.2m (€1.4m) has been slashed from wages and Greencore has “dodged” a tribunal ruling, from last year, to reverse the cuts. Mr Coveney said this was “completely untrue” and that management was negotiating with staff over improved benefits.

Although loss-making, the site contributes about 5% of Greencore’s UK revenues and management is confident of seeing further growth there.

A Unite spokesperson said yesterday it was “very disappointed” Greencore’s management was being awarded generous bonuses, while still refusing to enter meaningful dialogue regarding operations at the Hull facility.