Wizz Air faces pushback on plan to give chief extra time to hit £100mn bonus
Plans by Wizz Air to give its CE an extra two years to unlock a GBP100m bonus have triggered a backlash as the airline battles a depressed share price and the fallout of a regulatory reprimand for its handling of client claims. Proxy advisers Institutional Shareholder Services and Pirc have recommended investors vote against a resolution put forward by the low-cost airline to give József Váradi until 2028 to win the one-off award if Wizz Air’s share price hits GBP120. Shares stood at GBP24 on the eve of the company’s AGM, which is on Wednesday. Pirc, in a report, described the plans as “highly excessive”. ISS has also recommended shareholders reject the re-election of Barry Eccleston as chair of the board’s remuneration committee citing “material concerns” about Wizz’s practices. The company had given Váradi until 2026 to hit the scheme’s target when it first unveiled it two years ago, when its share price was more than GBP40. The price has since fallen, hobbled by Wizz’s unhedged exposure to the price of oil in the wake of Russia’s invasion of Ukraine, and questions over the durability of the current boom in air travel. Wizz Air’s board is joining others including at some US-listed companies in adjusting management incentive plans to account for the coronavirus pandemic and more recently to inflation and energy disruptions. Some of these adjustments occurred despite poor stock performances. The move to increase Váradi’s chances of hitting the payout comes as the airline is dealing with a reputational crisis in the UK for its handling of customer compensation in the wake of last year’s travel disruption. The UK’s aviation regulator last week reprimanded the airline for its “unacceptable” handling of customer compensation claims in the wake of cancelled or delayed flights. The airline has apologised and agreed to revamp its processes. ISS and Pirc have not only advised shareholders to vote against the company’s proposed amendments to the award, but also against its overall pay report and policy. The airline said the changes to the bonus scheme were a response to “the impact of external events on Wizz Air’s growth plans over the past two years”, including the war in Ukraine and supply chain backlogs.<br/>
https://portal.staralliance.com/cms/news/hot-topics/2023-08-02/unaligned/wizz-air-faces-pushback-on-plan-to-give-chief-extra-time-to-hit-ps100mn-bonus
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Wizz Air faces pushback on plan to give chief extra time to hit £100mn bonus
Plans by Wizz Air to give its CE an extra two years to unlock a GBP100m bonus have triggered a backlash as the airline battles a depressed share price and the fallout of a regulatory reprimand for its handling of client claims. Proxy advisers Institutional Shareholder Services and Pirc have recommended investors vote against a resolution put forward by the low-cost airline to give József Váradi until 2028 to win the one-off award if Wizz Air’s share price hits GBP120. Shares stood at GBP24 on the eve of the company’s AGM, which is on Wednesday. Pirc, in a report, described the plans as “highly excessive”. ISS has also recommended shareholders reject the re-election of Barry Eccleston as chair of the board’s remuneration committee citing “material concerns” about Wizz’s practices. The company had given Váradi until 2026 to hit the scheme’s target when it first unveiled it two years ago, when its share price was more than GBP40. The price has since fallen, hobbled by Wizz’s unhedged exposure to the price of oil in the wake of Russia’s invasion of Ukraine, and questions over the durability of the current boom in air travel. Wizz Air’s board is joining others including at some US-listed companies in adjusting management incentive plans to account for the coronavirus pandemic and more recently to inflation and energy disruptions. Some of these adjustments occurred despite poor stock performances. The move to increase Váradi’s chances of hitting the payout comes as the airline is dealing with a reputational crisis in the UK for its handling of customer compensation in the wake of last year’s travel disruption. The UK’s aviation regulator last week reprimanded the airline for its “unacceptable” handling of customer compensation claims in the wake of cancelled or delayed flights. The airline has apologised and agreed to revamp its processes. ISS and Pirc have not only advised shareholders to vote against the company’s proposed amendments to the award, but also against its overall pay report and policy. The airline said the changes to the bonus scheme were a response to “the impact of external events on Wizz Air’s growth plans over the past two years”, including the war in Ukraine and supply chain backlogs.<br/>
