Cruise giant Carnival storms over £11million

Cruise operator Carnival faces shareholder backlash over chef pay deal despite company receiving government backing and laying off staff

  • Investors prepare to vote against Carnival’s pay policy at its annual meeting
  • Arnold Donald received a package that could bring in up to $15 million
  • The company took out £25m in government-backed Covid loans in June 2020

Cruise operator Carnival is facing a backlash from shareholders over its chief executive’s bumper pay deal despite the company receiving government backing and laying off staff.

Investors in the world’s largest cruise line – which owns lines including Princess Cruises, Seabourn and P&O Cruises – are preparing to vote against its pay policy at its annual meeting on Friday. He will likely be among the first in a wave of shareholder rebellions as Britain emerges from the pandemic.

Carnival chief executive Arnold Donald has received a package worth up to $15m (£11.4m), including a $6m bonus, according to the annual report.

Troubled waters: Carnival chief executive Arnold Donald has been handed a package worth up to $15m (£11.4m), including a $6m bonus

A fund manager said she was not comfortable with pay arrangements after the company took out £25million in government-backed Covid loans in June 2020 and furloughed staff. Other bosses facing pay scrutiny last night include:

  • Alison Brittain, managing director of Premier Inn owner Whitbread, who is set to receive a bonus of more than £700,000 carried over from last year. The company received £370m from the taxpayer during the pandemic;
  • Outgoing Barclays finance chief Tushar Morzaria, who is facing calls for his bonus to be clawed back after a ‘mistake’ that cost the bank £450m;
  • Sebastien de Montessus, boss of Endeavor Mining, who received $10 million in financial aid when the company moved to its new headquarters in London.

Carnival was badly hit after cruises were halted in 2020. It was also in the spotlight when 3,500 passengers were stranded on its Grand Princess liner due to Covid. The company plunged into a loss of $10.2 billion in 2020. It fell to $9.5 billion last year.

One of Carnival’s largest shareholders told the Mail on Sunday that she would vote against the compensation plan. She added, “I wouldn’t be surprised if they got a high vote against them.” They laid off employees, they took money from the government and they didn’t pay dividends.

Institutional Shareholder Services, a top adviser to major pension funds, said it had “significant concerns” about Donald’s salary package.

Carnival said: “Our required documents … do not represent what our CEO actually received in any given year, as we operate within a pay-for-performance model where the majority of his CEO salary is at risk. ” However, a company filing last month suggests he won at least $11 million.

Whitbread’s Alison Brittain has come under fire for her £729,000 deferred bonus, which was delayed last year amid an uproar from shareholders, politicians and campaigners. She defied calls to scrap the bonus entirely, despite huge losses and support from taxpayers.

His company has claimed around £370m from taxpayers in cash and corporate rate relief – none of which has been refunded. She is in line to receive the bonus in the coming weeks on top of her £895,000 salary. She may also receive a separate bonus based on the most recent year’s performance. Whitbread said the bonus is “subject to board approval” this month and is “too early to comment”.

Luke Hildyard, of the High Pay Centre, said: ‘It is truly astounding that the Whitbread board sees nothing wrong with taking hundreds of millions of pounds of public money with one hand and then doling it out a multi-million pound salary package to an already extraordinarily wealthy CEO with the other.

It comes as the FTSE 100 group launched a search for Brittain’s replacement. She has had interviews with candidates who could replace her next year.

Elsewhere, Tushar Morzaria at Barclays is facing calls for his bonus to be scrapped. The bank revealed last week that it had exceeded its limit on selling certain investment banking products in the United States. The blunder cost him £450million and forced the lender to postpone a £1billion share buyback. A long-time shareholder has told the MoS that Morzaria should see his bonus recouped. Barclays declined to comment.

FTSE100 gold miner Endeavor Mining nearly doubled its boss’ salary last year to keep him on the job. Chairman and chief executive Sebastien de Montessus – whose 2021 revenue reached £17.3m – received a “one-time prize” of $10m when the company moved from Toronto to London. He said this was to prevent him from being ‘financially disadvantaged’ by resettlement.

Additional reporting by Calum Muirhead


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