The peer-to-peer business lender has seen losses widen and its shares lag since making its stock market debut.
Funding Circle has moved to cap the pay of its chief executive to less than half of last year's package, following widening losses and a disappointing stock market debut from the peer-to-peer business lender.
The FTSE 250 group, which arranges loans for small firms, said Sami Desai’s (pictured, centre) annual salary would be limited to £2m for the next three years “following feedback from shareholder advisory bodies”.
The boss of the peer-to-peer lender has also agreed to waive his rights to this year's £2.18m long-term incentive plan, linked to revenue and earnings per share growth. The proposals will be put to shareholders at the group's annual meeting on 5 June.
The move comes after the fintech reported a full-year loss of £50.7m in March, compared to £36.3m the year before, after IT costs jumped during the period.
This also follows an underwhelming London Stock Exchange debut last October, which saw the platform launch at 440p per share, valuing the platform at £1.5bn. However, the business has consistently traded below that level, closing at 252.5p on 28 May, 43 per cent below its autumn launch price.
Funding Circle said Desai’s pay will now be limited to “a maximum of £1.98m”, while its chief financial officer, Sean Gilthero, will have his pay set to “a maximum of £1.12m”, according to a 22 May stock market statement.
Last year Desai, who is a co-founder of the business, earned £4m, while Gilthero earned £1.08m. As part of last year's package, Desai was awarded share options worth £3.87m to be drawn down over a five-year period, according to the group’s latest annual report. His base salary was £210,000.
Gilthero was handed shares worth £777,000 over the same period. His base salary was £300,000. The bonuses both men received in 2018 had “no performance conditions” attached, the annual report added. However, the chief financial officer will take part in this year's long-term incentive plan, which could see him earn £1.42m.