Sainsbury’s shareholders voted overwhelmingly against the special Living Wage resolution

The overwhelming majority of Sainsbury’s shareholders have rejected a special resolution that, if approved, would have seen it become the first major supermarket to be Living Wage accredited.

A coalition of investors led by activist group ShareAction had earlier this year filed a special resolution – also known as Resolution 21 – with the company to try and get it to sign up to the Living Wage Foundation, which guarantees that all employee salaries are in line with official living wage guidance.

The move had also recently garnered public support after more than 100,000 people signed a petition requesting Sainsbury’s become a Living Wage accredited employer.

But at the grocer’s annual shareholder meeting this Thursday, 7 July, only 16.7% of shareholders voted in favour of the motion. Resolution 21 needed at least 75% of the votes to go ahead.

Earlier this week, CEO Simon Roberts had reinforced that the company did not support the sharholdere resolution as it preferred to determine its own staff pay rather than depend on a third party’s decision.

Sainsbury’s chairman Martin Scicluna added after the AGM verdict: “We are proud to have led the way on colleague pay in our industry for the past five years and to pay our colleagues the living wage regardless of where they work in the country.”

“We would like to thank our shareholders for their overwhelming votes of support and confidence in how Simon and his team are running the business.

“We believe very strongly in paying people well for the excellent job they do for our customers every single day. We also believe that we need to make all business investment decisions independently and that these decisions should not be outsourced to a third party.”

Sainsbury’s had come under fire in recent months over staff pay. Even though the supermarket had upped wages for store colleagues at the start of the year, it was eventually forced to bring salaries of its outer London staff up in line with official Living Wage rates after public upheaval.

Calls for the grocer to join the Living Wage Foundation were then renewed after it was revealed that CEO Roberts was bagging a £3.8m pay and bonus package at the same time as reports emerged that retail staff were having to use food banks due to rampant living costs.

At Thursday’s shareholder meeting, all proposals barring Resolution 21 – including that of approval of executive team remuneration – were greenlit by investors.

Commenting on the vote, ShareAction campaign manager Rachel Hargreaves said the support garnered in favour of Resolution 21 “sent a powerful message”, but that the group was “equally disappointed that a large proportion of shareholders chose to prioritise short-term returns over the real long-term issue: rising inequality in our society”.

”As we deal with the continued effects of the cost of living crisis, the conversation around low pay isn’t going to go away, and both employers and investors need to step up. We look forward to hearing how the company will address shareholder concerns.”

Questions still remain over Sainsbury’s contracted staff, including security guards and cleaners. Roberts has vowed to continue working with suppliers of contracted staff to “encourage them” to pay “at or above the living wage”.