[UK] Shareholder backlash over low high street pay rates

In the UK, a shareholder backlash is confronting big name high street stores including Sainsbury’s, Marks & Spencer and JD Sports centred around their failure to commit to paying all staff and third-party contractors a real living wage, City A.M. reports.

Among the financial giants backing a campaign against low pay are LGIM, HSBC Asset Management, Aviva, and Scottish Widows. These institutions have a total of $6.6 trillion (£5.2 trillion) in assets under management.

Responsible investment group Shareaction is leading the campaign. It intends to push back against a number of retailers over their wages throughout the year. Those in the firing line reportedly include Tesco, Greggs, Next and B&Q owner Kingfisher.

On July 2, Shareaction questioned M&S at the company’s annual general meeting about why it has not committed to pay its third-party contracted staff - such as cleaners and security guards - a real living wage, despite it making a profit of over £700m in 2023.

Shareaction also planned to urge M&S - which raised its CEO’s pay by 75 per cent this year - to accredit to pay all its staff the real living wage on an ongoing basis.

On July 4, the investment group is set to challenge JD Sports and Sainsbury’s at their respective AGMs to ensure their staff and all third-party contractors are being paid the real living wage.

According to Shareaction, Simon Roberts - Sainsbury’s CEO - is reportedly poised to receive almost £5m in pay this year, 212 times as much as the supermarket’s average employee.

The real living wage was established by the Living Wage Foundation. It is the minimum hourly pay rate needed for workers to be able afford housing, food and other basic needs. It currently stands at £12 per hour in the UK and £13.15 per hour in London.

Dan Howard - head of good work at Shareaction - told City A.M., “Inadequate pay is a widespread issue in the retail sector, leaving many workers struggling to make ends meet, and with all sorts of negative knock on effects on businesses from high turnover rates to low productivity.

“It’s in these businesses’ interests to pay their staff a real Living Wage, which allows workers to afford the basic goods and services they need, from housing to food to bills.

“Crucially, we need to see companies accrediting as Living Wage Employers, which means they commit to paying all their staff a real Living Wage, including third-party contractors, now and into the future.”

Catherine Howarth - chief exec of Shareaction - posed one of the questions at M&S’s AGM. She said, “The cost-of-living crisis has made it clear that pay inequality and in-work poverty are a blight on our society and urgently need tackling.

“Businesses paying the real living wage is vital to protect living standards for low-paid workers and serves the long-term interests of businesses, investors, and society.

“This is why we are calling on investors to use their influence as shareholders to steward companies in the right direction and ensure all workers receive the real living wage.”

City A.M. contacted M&S and JD Sports for comment. Sainsbury’s reportedly declined to respond.

Source: City A.M.

(Quotes via original reporting)

In the UK, a shareholder backlash is confronting big name high street stores including Sainsbury’s, Marks & Spencer and JD Sports centred around their failure to commit to paying all staff and third-party contractors a real living wage, City A.M. reports.

Among the financial giants backing a campaign against low pay are LGIM, HSBC Asset Management, Aviva, and Scottish Widows. These institutions have a total of $6.6 trillion (£5.2 trillion) in assets under management.

Responsible investment group Shareaction is leading the campaign. It intends to push back against a number of retailers over their wages throughout the year. Those in the firing line reportedly include Tesco, Greggs, Next and B&Q owner Kingfisher.

On July 2, Shareaction questioned M&S at the company’s annual general meeting about why it has not committed to pay its third-party contracted staff - such as cleaners and security guards - a real living wage, despite it making a profit of over £700m in 2023.

Shareaction also planned to urge M&S - which raised its CEO’s pay by 75 per cent this year - to accredit to pay all its staff the real living wage on an ongoing basis.

On July 4, the investment group is set to challenge JD Sports and Sainsbury’s at their respective AGMs to ensure their staff and all third-party contractors are being paid the real living wage.

According to Shareaction, Simon Roberts - Sainsbury’s CEO - is reportedly poised to receive almost £5m in pay this year, 212 times as much as the supermarket’s average employee.

The real living wage was established by the Living Wage Foundation. It is the minimum hourly pay rate needed for workers to be able afford housing, food and other basic needs. It currently stands at £12 per hour in the UK and £13.15 per hour in London.

Dan Howard - head of good work at Shareaction - told City A.M., “Inadequate pay is a widespread issue in the retail sector, leaving many workers struggling to make ends meet, and with all sorts of negative knock on effects on businesses from high turnover rates to low productivity.

“It’s in these businesses’ interests to pay their staff a real Living Wage, which allows workers to afford the basic goods and services they need, from housing to food to bills.

“Crucially, we need to see companies accrediting as Living Wage Employers, which means they commit to paying all their staff a real Living Wage, including third-party contractors, now and into the future.”

Catherine Howarth - chief exec of Shareaction - posed one of the questions at M&S’s AGM. She said, “The cost-of-living crisis has made it clear that pay inequality and in-work poverty are a blight on our society and urgently need tackling.

“Businesses paying the real living wage is vital to protect living standards for low-paid workers and serves the long-term interests of businesses, investors, and society.

“This is why we are calling on investors to use their influence as shareholders to steward companies in the right direction and ensure all workers receive the real living wage.”

City A.M. contacted M&S and JD Sports for comment. Sainsbury’s reportedly declined to respond.

Source: City A.M.

(Quotes via original reporting)