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Schroders faces investor backlash over family appointment

Glass Lewis has urged Schroders investors to rebel against the appointment of the daughter of the late Bruno Schroder to its board and 'excessive' bonuses at the firm

Schroders faces investor backlash over family appointment

A proxy adviser has urged Schroders investors to rebel against the appointment of the daughter of the late Bruno Schroder to its board and its 'excessive' bonuses.

Glass Lewis has urged shareholders to vote against the election of Leonie Schroder at the firm's annual meeting next month.

Schroder was appointed to the board in March. Although she is listed as director of a number of other family enterprises and charity trusts, she appears to have little experience of the finance sector. 

Glass Lewis also told investors to block the re-election of Michael Dobson as chair who, with responsibility for the board make-up, 'should be held accountable for this failure'. 

The advisory firm added: 'We do not believe a sufficiently robust rationale has been presented for the election of nominee [Leonie] Schroder, and question whether, in representing her family interests, she has sufficient core industry or sector experience to effectively challenge management.'

The Schroder family owns 35% of the business. In a stockmarket announcement in March, Dobson said Leonie Schroder's appointment reflected 'the commitment to Schroders of the principal shareholder group, which has been an important part of Schroders' success over the long term'. 

In its 28-page analysis of Schroders, Glass House also said it had 'severe reservations' about supporting the firm's pay report, which saw chief executive Peter Harrison handed a £6 million bonus on top of a £500,000 salary last year. 

'We remain concerned the annual bonus plan has consistently led to unnecessarily high payouts,' Glass Lewis said. 'We cannot recommend that shareholders support this proposal.' 

According to reports, a spokeswoman for Schroders said the company has a 'clear and thorough process' on pay 'which we have followed rigorously and which has served the firm and all its stakeholders well over many years'.

Schroders biggest shareholder outside the family is Citywire AA-rated Nick Train. He has been gradually increasing his stake in the business over the last year and now owns a 10% stake.

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