The Australian Shareholders Association has joined an institutional shareholder revolt against David Jones that is expected to deliver a first strike against the remuneration report of the department store operator at this Friday's shareholder meeting.
While other shareholders are expected to use the vote as an opportunity to protest about recent controversies at David Jones - share acquisitions by two directors days before price-sensitive announcements by the company, as well as the mysterious and sudden resignation of chief executive Paul Zahra - the ASA said there were legitimate reasons for rejecting the report in its own right.
Given poor results to date and the meagre prospects in sales, margins and multi-channelling, the ASA said the short-term incentives (STI) offered to the executive team were too generous.
"Mr Zahra was awarded 88 per cent of his STI for 2012-13, which seems excessive," the ASA report said.
A no vote on a company's remuneration report of more than 25 per cent at two consecutive annual meetings triggers a resolution to spill the entire board.