Pressure increases on RBS bosses as more shareholder advisers call for revolt

The heat is being turned up on bosses at Royal Bank of Scotland ahead of the lender’s AGM next week after two more investor advisory firms joined calls for shareholders to reject the board’s remuneration policy.

Institutional Shareholder Services and Pirc have now echoed previous instructions from small investor group ShareSoc in advising shareholders to revolt because it is unclear how bonuses will be paid out to senior directors.

The group, which advises institutional investors, raised concerns about what will qualify Chief Executive Ross McEwan and Chief Financial Officer Ewen Stevenson to earn payouts even though the size of potential bonuses are being cut.

The firm said that the reduction in bonuses available to McEwan and Stevenson was not enough to offset “uncertainty around how performance will be assessed.”

Pirc, also recommended investors vote against the pay policy.

Chairman Sir Howard Davies has already become the target of a possible rebellion after ShareSoc singled him out for refusing to set up a shareholder committee to give retail investors more say in how the bank is run.

RBS has refused to allow a resolution to be put to the AGM on May 11 to establish such a committee, saying the bank is not obliged to.

ShareSoc said shareholders in the bailed-out bank should therefore vote against the pay scheme for directors and the re-election of Davies in protest.

Pirc also called for action against Sir Howard after his failure to draw up plans to have more women elected to the still 73 per cent state-owned bank’s board.