Barclays boss apologises to shareholders

Jes StaleyImage copyright

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Jes Staley has apologised for his actions

Barclays boss Jes Staley has apologised to shareholders for his handling of a whistleblowing scandal, ahead of a vote on his re-election to the board.

“I made a mistake in becoming involved in an issue which I should have left to the business to deal with,” he said.

Mr Staley is facing investors for the first time since it emerged he attempted to find out the identity of a whistleblower at the bank.

He had previously apologised and referred himself to regulators.

However, some investors say they will not support his re-election at Wednesday’s annual general meeting.

Institutional Shareholder Services (ISS), an influential shareholder advisory group, has told investors to abstain in the vote, citing concerns over “his personal involvement and accountability” in the controversy.

“Given his personal involvement and accountability in this matter, and given the importance of his role as group CEO, an abstention on his re-election is considered appropriate,” it said.

The group’s members hold around a quarter of the bank’s shares.

Mr Staley also said on Wednesday that he did not see a need to shift jobs or significant operations out of Britain as a result of the vote last June to leave the EU, regardless of how the exit negotiations pan out.

Shareholders will also be voting on the remuneration of top executives, with some set to oppose what they see as excessive pay packages.

Corporate governance body Pirc, which advises many of the largest institutional investors on how to vote, has advised investors to vote against the bank’s remuneration report.

It said Mr Staley’s pay last year was 49 times higher than that of the average Barclays’ employee and therefore “inappropriate”.

Pirc also advised shareholders to vote against the bank’s future plans for rewarding executive staff.

The Barclays board has already pledged to dock Mr Staley’s pay over the whistleblowing issue, possibly by as much as £1.3m, or all of his annual bonus.

It also supports Mr Staley’s re-election, having described the chief executive’s role in the affair as “an honest mistake”.

While he is expected to be re-elected to the board, investors will be watching the margin of the vote closely.

Laith Khalaf, a senior analyst at Hargreaves Lansdown, said: “Jes Staley hasn’t done himself a lot of favours recently, though the operational progress he has made at Barclays will have earned him some good will from shareholders.

“We can therefore expect him to survive the shareholder vote, though he will face a significant cut in pay for his handling of a whistleblowing case within Barclays.”

Whistleblowing claims

The controversy surrounding Mr Staley dates back to June 2016, when Barclays’ board members and another senior executive received anonymous whistleblowing letters.

These raised concerns of a personal nature about a senior employee who had been recruited by Barclays earlier that year, as well as about Mr Staley’s role in dealing with those issues at a previous employer.

Mr Staley subsequently asked Barclays’ internal investigation team to try to identify the author of the letters, which he felt had made unfair personal attacks on a colleague.

He later told the Barclays board he had been trying to protect the individual who had experienced personal difficulties, but admitted he got “too personally involved”.

The Financial Conduct Authority and the Prudential Regulation Authority are now both investigating the matter.

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