By Danny Gazzi, AGM Activist
On 12 October 2017, I was off bright and early to Isleworth for British telecommunication giant Sky’s annual general meeting. This particular AGM promised to be interesting. Sky had been in the news because of continuing controversy over a proposed takeover by 21st Century Fox (Fox), and the huge pay increases received this year by Jeremy Darroch (Sky’s Chief Executive) and Andrew Griffith (its Chief Operating Officer). This year, Darroch’s pay increased from an already eye-watering £4.6 million to £16.3 Million, and Griffith’s increased from £2.5 million to £9.2 million.
The Pensions and Investments Relations Consultants (PIRC) strongly criticised this as “highly excessive” and opposed the re-election of James Murdoch as Chairman, due to the conflict of interest with his role as Chief Executive of Fox. It was an AGM that had been all over the news in the lead-up and I was keen to see how the Board would deal with these governance risks now that the press and organisations like PIRC were turning their attention to it. Unfortunately, it wasn’t the dramatic event I hoped for.
It was an AGM that had been all over the news in the lead-up and I was keen to see how the Board would deal with these governance risks now that the press and organisations like PIRC were turning their attention to it.
There were a few mild questions expressing concern over the takeover by Fox, which seemed easily batted away by the Board. There was no question about Darroch or Griffith’s sneaky bump in executive pay, although the shareholder vote against the remuneration report was higher than normal.
I had a question about the Living Wage, which is currently £9.75/hour in London, and £8.45 in the rest of the country. I mentioned that recent research by the Cardiff Business School showed that paying at least the real Living Wage to all staff provides tangible business benefits including reduced staff turnover, increased productivity, and an enhanced company reputation .
ShareAction, the Living Wage Foundation, and fair pay activists across the UK (including me!) recently celebrated the news that 1/3 of the FTSE 100 are now accredited as real Living Wage employers with the Living Wage Foundation. Accreditation is the simple assurance workers across the UK need to know that a company’s workforce will be paid in a way that truly accounts for the rising cost of living.
Knowing that, I asked the Board for an update on where Sky stands on becoming an accredited Living Wage employer. Was the Board ready to meet with ShareAction, the Living Wage Foundation, institutional investors (their shareholders!) to plan the next steps to fair pay for their hard-working UK staff?
This year, Darroch’s pay increased from an already eye-watering £4.6 million to £16.3 Million, and Griffith’s increased from £2.5 million to £9.2 million.
Darroch seemed well prepared for the question. And – speaking from the perspective of someone who has asked a lot of FTSE 100 Boards about the real Living Wage – he seemed to understand why the Living Wage is a better standard than many others. He said that 99.4% of their staff are paid above the real Living Wage, and that the other 0.6%, who are recent starters, will reach this level this year.
It was encouraging but I held on to the microphone and followed up for clarification.
It quickly became clear that the 99.4% did not yet include Sky’s contractors, such as cleaners and caterers. These workers also need to be paid fairly for Sky to secure accreditation.
After all that, Darroch said they are willing to meet with us to discuss next steps. Immediately after the AGM, I had a fruitful discussion with Sky’s People Director and Rewards Director which gives me hope that this year’s meetings could be fruitful. Within a day, company representatives were in touch with the Living Wage Foundation to arrange a meeting in November. Very positive!
Perhaps next year we can probe Sky’s pay ratios? I’ll be poised and ready to craft another great AGM question.
Thanks Danny! To find out more about our work on the Living Wage click here