Investors lambast Sears board

The board of Sears, the struggling retail group, was given a hostile reception at its annual meeting in central London yesterday as small shareholders vented anger over the company's dismal performance.

The directors faced a barrage of angry questions on the pay-off to former chief executive Liam Strong, the company's poor record and the lack of retail experience on the board. There was also more bad news on trading with the group showing a slowdown in childrenswear sales and falling sales in its footwear operations.

"Looking at the board, it would seem to be wonderfully constituted for anything but a retail company," one small shareholder said.

Another shareholder, a Mr Muriel, criticised the compensation paid to Mr Strong who left the company in April. "He leaves with pounds 465,000. My question is: Why?"

Sir Bob Reid, the Sears chairman responded by saying that the company was merely fulfilling its contractual obligations. This failed to satisfy the packed audience, with one investor declaring the payment "blatantly rewarded failure".

Mr Muriel further criticised the board's remuneration committee for agreeing to pay additional sums to Mr Strong if he failed to secure equivalent employment within nine months of his resignation.

Mr Strong was not at the meeting yesterday. Sir Bob said he was "very busy" doing consultancy work.

There was a ripple of ironic applause when Sir Bob announced that David Macdonald was to step down as a non-executive director of Sears after 16 years on the board. The former Cabinet minister Lord Tebbit, on the Sears board for 10 years, was also the target of a personal attack. "I'd like to know what Norman Tebbit actually does for a retailer?" asked one shareholder. Sir Bob replied: "I will not answer that because I do not intend to talk about individuals. I believe in self-respect."

A trading statement showed that Sears' like-for-like sales in the 19 weeks to 14 June rose 2.5 per cent against a 5.3 per cent jump for the first 11 weeks. Sales slowed at Adams childrenswear while the shoe operations will make a significant loss.