Shire faces fresh criticism over CEO pay in crunch week

Drugs firm Shire, which employs hundreds of people between its Co Meath campus and at its head offices in central Dublin, faces fresh criticism over its executive pay policy from a leading investor advisory group as a crunch week approaches.

Shareholders will vote on pay and other matters at Shire’s AGM on Tuesday, a day before Japan’s Takeda must decide whether it will make a takeover bid.

Pensions & Investment Research Consultants, or Pirc, believes that Shire CEO Flemming Ornskov’s maximum potential bonus is “excessive” at 780% of salary, even though Mr Ornskov’s total pay last year fell to $5.3m (€4.28m) from $10.6m, after a disappointing year for the firm, which is registered in Jersey, headquartered in Dublin and listed in London.

Two years ago, almost half of its shareholders voted against Shire’s executive pay plans and then won 93% support in 2017. Two other shareholder advisory groups, ISS and Glass Lewis, said they recommended votes in favour of all of Shire’s 2018 AGM proposals.

Mr Ornskov has come under fire from investors after his $32bn purchase of Baxalta in 2016. That marked a change in sentiment towards the former stock market darling that was nearly bought by AbbVie in 2014.

Earlier this week, Shire agreed to sell its cancer drugs business to France’s Servier for €1.94bn. Shire shares were up over 2%, valuing the firm at €38bn.

Reuters. Additional reporting Irish Examiner