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- Unilever CEO Hein Schumacher will have his pay frozen until 2026.
- Shareholders voted against his base salary of $1.96 million at the AGM in May.
- Schumacher has said he will change tact from his predecessor's emphasis on brands with a social purpose.
The CEO of Unilever won't be able to get a pay rise until 2026 amid shareholder frustration, Bloomberg reported.
The board's proposed pay package was rejected by shareholders at Unilever's annual general meeting in May, per Bloomberg.
Hein Schumacher will take home a base salary of 1.85 million euros ($1.96 million), but it won't be reviewed again for two years.
That's a nearly 20% increase on the fixed pay of the previous CEO, Alan Jope, from whom Schumacher took over in July. Jope was paid 1.56 million euros ($1.65 million) in 2022.
But nearly 60% of shareholders voted against the deal put forward by the Unilever board, which includes the activist investor Nelson Peltz, Reuters reported.
"Whilst the majority of shareholders agreed that the fixed pay level for the new CEO appropriately reflected the size and complexity of the role, there was a preference that alignment with the market could have been achieved gradually, rather than in one step on appointment," the company said in a statement seen by the news agency.
Unilever said it held 37 meetings with 24 of its top shareholders to discuss that vote, and their feedback led it to decide on the pay freeze, per Reuters.
It means Schumacher won't be eligible for a pay increase in 2024 or 2025, and his fixed pay level will be reviewed by a compensation committee in 2026.
The decision comes days after Schumacher changed the company's tact on promoting brands with a social purpose, The Telegraph reported.
Under Jope, the company said it would sell off brands that "are not able to stand for something more important than just making your hair shiny, your skin soft, your clothes whiter or your food tastier," per The Telegraph.
That had prompted a backlash from shareholders like Terry Smith, who said in a 2022 letter to his fund's investors that Unilever had "clearly lost the plot."
Unilever declined to comment when contacted by Insider.