Investors fuming as GSK drags feet

GLAXOSMITHKLINE is in danger of walking into another minefield over pay after the unprecedented shareholder revolt over the £22m package for its boss Jean-Pierre Garnier.

Big City firms - after winning their battle with Carlton - are watching GSK like hawks. They are growing increasingly worried at the time it is taking to revise its pay policy, thrown out at its May agm.

One influential fund, which has heard nothing for months, said: 'We are concerned that it is taking a bit long. It does not give us much time to sort out any problems. This is a huge test case on pay. GSK cannot afford to get it wrong again. As investors we cannot allow ourselves to be tarred with the same brush.'

Unless GSK's chairman Sir Christopher Hogg gives reassurance on Wednesday - when its third-quarter results are announced - that a revised pay policy will appear very soon, shareholders say they will ask for an explanation.

As well as criticising Garnier's twoyear contract, rebels were outraged at his lavish severance package.

Accountant Deloitte & Touche was hired in January to advise on how to make GSK's pay strategy palatable. Pay policy needs to be spelt out in the annual report in March.

Shareholders are now hearing gossip that Garnier wants compensation for halving his two-year contract.

Some investors oppose this rigidly, but another said: 'We think it is more important to get the issue of performance-related pay right.'

GSK on Tuesday opened a £45m state-of-the-art chemistry research unit in Harlow, Essex.

Analysts expect 19% profits growth from GSK on Wednesday and are eager to hear how its new anti-impotence drug Levitra and depression treatment Wellbutrin XL are progressing. The shares rose 12p to 1294p.