Spar will be able to pay its non-executive directors after shareholders voted in favour of the resolution at a special general meeting on Friday.
In an unusual turn of events, the resolution on directors’ remuneration failed to pass at the February AGM, leaving directors earning nothing.
It is highly unusual for the resolutions on directors’ fees not to garner the required majority and for directors to work for free.
However, Spar had been embroiled in controversy including a long-standing feud with the Giannacopoulos brotherswho run more than 40 Spars and bottle stores. There have been multiple court battles between the family and the wholesaler.
Former chair Graham O’Connor’s family had extensive business interests linked to Spar and he moved from his position as CEO to that of chair in breach of King Code IV recommendations, which advise a three-year break between the two roles for independence purposes.
Former CEO Brett Botten was linked to approving some fictitious transactions in a scandal in which BEE retailers said they had been sold unprofitable stores on incorrect profit numbers.
However, Spar appointed new directors including chair Mike Bosman, who is also chair at restaurant group Spur and a non-executive director at EOH and MTN.
New nonexecutive directors including former Shoprite nonexecutive director Shirley Zinn and SA-born Pedro da Silva, who has extensive foreign retail experience, have not been paid since March 1.
Da Silva is offering advice on the business in Poland where Spar has been unable to turn a profit. Spar owns a warehouse and sells to some independent stores but lacks the economies of scale and footprint to make it feasible. However, it has more than R1bn debt linked to the country making it difficult to pull out. Da Silva worked at Pick n Pay in SA, at a large Russian retailer and in Poland, giving him insight into local retailers and the East European market.
Spar said in August that after receiving feedback from shareholders, the remuneration committee restructured the proposed fees. They include a retainer and meeting attendance fees.
Spar says its new fees are “independently benchmarked against an industry-based peer group comprising direct and indirect competitors and other JSE-listed retail companies”.
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