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WH Smith has been warned by investors over the salary package of its new chief executive, Carl Cowling.
The top boss of the UK stationer is being paid a pension contribution worth 12.5% of his salary.
The Investment Association has issued its strongest-ever objection to the payment, because it says it is not in line with that of the average worker.
The company says in its annual report that Mr Cowling does not earn as much as his predecessor.
Stephen Clarke, the company’s ex-CEO previously received twice the pension contribution award but since then the company has reduced what it gives its executives.
Mr Cowling will make £525,000 this year with an annual bonus of up to 160% of his salary, plus his pension awards.
All executives at WH Smith are eligible for the company’s defined contribution pension plan – or receive a salary supplement in lieu – but its other workers do not enjoy the same perks.
There is a pension scheme for its UK employees but the company has not disclosed what the average contribution is.
HMRC has recently raised the minimum employer contribution for UK company pensions to 3% of an employee’s salary – with another 5% to contributed by employees themselves.
WH Smith employs just over 14,000 people but under half have signed up to its pension scheme.
The warning notice that WH Smith has earned over its executive pension awards has come because of feedback that the Investment Association received from the company’s big shareholders.
News of the Investment Association’s alert was first reported by Sky.
Recently the Investors Association, which represents the shareholders of public companies, has become more vocal about excessive executive pay.
In a statement about the association’s new approach, director Andrew Ninian said: “Providing directors the same pension contributions as the rest of the workforce is fundamentally an issue of fairness.”
WH Smith’s annual meeting will be on January 22 and matters such as executive pay will be up for a vote.
However, it would be rare for an investor to introduce their own motion for a vote. WH Smith will decide the schedule and then investors will vote on the measures.