City AM – Management pay at First Group was slammed yesterday by Tom Sandell of New York-based hedge fund Sandell Asset Management, as he said the management team of the UK rail and bus operator had been “well rewarded for failure”.
The comments came in an open letter from Sandell to John Macfarlane, chairman of the board of directors of First Group. Sandell said that First Group’s chief executive renumeration package had risen by 209 per cent in the last five years, with Tim O’Toole the highest- paid CEO among his peers. Yet he claimed that during this five-year period First Group’s share price performance was the worst among it peers with minus eight per cent return, compared to a positive return of 239 per cent for its peers.
