(Reuters) - Royal Mail Plc's (L:RMG) shareholders rejected a pay package for its senior executives on Thursday.
The post and parcels company said about 70.17 percent votes cast by shareholders at the annual meeting were against the resolution on the director's remuneration report.
Shareholder advisory firms Institutional Shareholder Services (ISS) and Glass Lewis had recommended that shareholders vote against the pay packages.
Royal Mail said it would consult with shareholder and representative bodies as part of its scheduled review of the remuneration policy. The review is due to take place in autumn.
One of the concerns from shareholders is the company's payment to retiring CEO Moya Greene on her exit, estimated to be 915,000, Royal Mail said.
"Support for the remuneration report is not considered warranted due to termination payments to the former CEO which exceed UK market norms and also include an element of guaranteed bonus payments," ISS said in a report earlier this month.
ISS added the company's treatment of Greene's bonus is not considered to be on a cost-neutral basis for shareholders and the disclosures in previous years have fallen short of accurate representation on termination provisions.
The company defended the payment saying the arrangements have been in place since 2010 when Royal Mail was state owned.
However, it said similar provisions had not been replicated in any current contracts for executive directors and they would not be in future.
Under Greene, one of the handful of female CEOs in the FTSE 100 (FTSE), Royal Mail was privatised in 2013 and has since reduced layers of management, upgraded technology and cut its property bill to save costs.
The company in April named the boss of its fast-growing European parcels business, Rico Back, to succeed Greene.
Back was given a near 17 percent higher salary at 640,000 pounds, which was also criticised by the advisory firms.
An ISS spokeswoman said they does not comment on individual company meeting vote results. Glass Lewis was not immediately available for a comment.