April 29, 2015 / 8:29 PM / 3 years ago

Yamana Gold pledges to fix executive pay plan after investors vote 'no'

TORONTO, April 29 (Reuters) - Yamana Gold Inc will change its executive pay plan to better reflect performance, the mid-tier miner told shareholders on Wednesday after they voted against the plan, a day after industry leader Barrick Gold Corp made the same promise to its unhappy investors.

More than 50 percent of Yamana shareholders who voted rejected the plan, according to early returns, Chief Executive Peter Marrone said after Yamana’s annual meeting in Toronto.

“We regret this result, although we have clearly understood the message,” Marrone told shareholders, adding that he had made a personal decision to waive 450,000 performance share units that he was awarded last June.

“I hope that that will be seen as a positive sign of our intention and commitment to aligning our compensation to performance,” Marrone said.

The stock units, which have been canceled, were related to Yamana’s and fellow Canadian gold miner Agnico-Eagle’s joint purchase of Osisko Mining in 2014.

Although say-on-pay shareholder votes are not mandatory in Canada, and companies are not required to take action on the outcomes, they are considered important barometers of investor attitudes.

Influential advisory firm Glass Lewis recommended against Yamana’s plan, citing excessive compensation and one-off awards, with a “significant disconnect between pay and performance”.

The CPP Investment Board, Canada’s largest pension fund manager, voted against the Yamana plan, but supported the reelection of the company’s directors. All 10 Yamana directors were reelected on Wednesday.

Marrone was paid $8.5 million in 2014, Yamana said, comprised of $5.7 million in compensation and a $2.7 million cash award tied to the Osisko acquisition.

The company’s shares fell 49 percent in 2014.

In 2013, Marrone was paid $10.3 million and in 2012 he got $12.1 million.

Yamana will also consider ways to increase share ownership by executives, Marrone said.

Shareholders at the meeting also asked the company to consider holding fewer board meetings, to better detail board compensation and to forgo further dilutive share issues for acquisitions.

On Tuesday, about 75 percent of Barrick shareholders who voted opted to reject the company’s executive compensation plan. Investors were unhappy with Chairman John Thornton’s $12.9 million compensation for 2014, a 36 percent increase from 2013 despite a 39 percent drop in Barrick’s stock price. (Editing by Peter Galloway)

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