The chairman of Paddy Power owner, Flutter Entertainment, has defended the company's remuneration policy for top executives, after a bloc of shareholders registered unhappiness at today's annual general meeting.
The move follows Flutter's decision to increase the basic salaries of its chief executive by 26% and its chief financial officer by 20%.
Around 32% of the proxy votes received in advance of this morning's AGM opposed approving the remuneration report, with the balance voting in favour of it.
It follows two influential advisory firms urging shareholders to oppose the pay increases which one, Institutional Shareholder Services (ISS), claimed were not justified.
However, Flutter chairman Gary McGann said that when additional proxy votes, which had not been included in the tally were added, the level of approval of the remuneration report rose above 70%.
"I think the response to the remuneration resolution was extremely good," Mr McGann told the media after the meeting, describing it as a good outcome.
He added there had been extensive consultation with institutional shareholders on the matter and the major concern, if any, that the company gets from shareholders is that it retains its top executives.
"This is an incredibly competitive sector, the consumer digital sector is the most competitive sector probably in the world right now," the chairman said.
Flutter had justified the salary increases on the basis that plans for a new long-term incentive plan for top executives had been postponed.
The rise in salary brought CEO Peter Jackson's basic pay to £1.17m and CFO Jonathan Hill's to £715,000.
In total in 2021, when a previous incentive plan is taken into account, Mr Jackson, received £8.4m in remuneration.
"Performance based pay is a considerable part of it," Mr McGann claimed.
"We are competing in a global market place, we replaced our CEO in the US and quite frankly both the two executive directors who are on our board are at the bottom end of anything that would be available to the equivalent in the US and we are competing for that type of talent all the time," he added in reference to the bosses' pay.
Peter Jackson also defended the company's record on dealing with the issue of problem gambling, saying Flutter had consistently "raised the bar" in its approach to safer gambling.
He said a very significant investment had been made in terms of cash invested in infrastructure and people, as well as through revenue foregone and added that company is very focused on recreational users who spend small amounts on gambling.
"We believe we are the most progressive operator," he said.
"We like to think that we are around the world raising the bar and engaging in a race to the top, which is encouraging and forcing our competitors to do the same," the Flutter chief said.
The company recently announced details of a safer gambling strategy.
However, during the AGM one activist shareholder took issue with Flutter's commitment to dealing with the issue.
Olwyn Patterson, representing the 1,000 members of the Trinity College Student Managed Fund, said they were not happy.
"Flutter claims that it's new PlayWell Strategy will help customers play well, however after analysing the action Flutter has taken to implement this, we are not happy with the half attempted efforts Flutter has made," she said.
She said that recent research showed unhealthy gambling is rife among young people and claimed Flutter was not diverting enough cash to tackle the problem.
Ms Patterson said 100% of players should be using safer gambling tools by 2030, not 75% as targeted, and she said she hoped her presence as a young person at the meeting sent a strong signal that action must be taken.
Responding to her questions, Gary McGann said the vast majority of people who engaged with Flutter's products do so safely and for entertainment purposes and that just 0.3-0.7% of the entire population are problem gamblers.
He told the AGM that the evidence is there that Flutter has done significantly more than anyone else to address the issues, which are complex and fast changing and that the vast majority of players play "safely and economically comfortably."
Asked about the impact of inflation on customer behaviour, Peter Jackson said many are having to tighten their belts.
"There is no doubt that will impact their expenditure, the extent to which that impacts our business will need to remain to be seen over the course of the year," he said.
He said the company continues to take market share in the US where it has expanded rapidly in recent years and the opportunity there "is enormous".
Regarding the potential for an initial public offering (IPOs) of its FanDuel business in the US, Mr Jackson said the markets are not open for IPOs at the moment.
Ge said the board continues to monitor the situation, but it is not something the company needs to do.
Mr Jackson said Flutter is complying with European, UK and US sanctions against Russia and the business is not operating there.
Mr McGann told shareholders during the meeting that 2021 had been a strong year for the company which had made good progress against is objectives, including a refresh of its strategy.
Flutter is due to provide a trading update update next week.
Its shares moved higher in Dublin trade today.
