Sanderson's remuneration chair warns its biggest shareholder of legal action over pay questions
Sanderson Design Group director Patrick Lewis has warned its 14% shareholder, LBV, of possible defamation action over criticism of executive pay. LBV is seeking the chairwoman's removal on 29 October and has taken the exchange to shareholders.
The Board Room · Leadership desk
Key figures: chief executive Lisa Montague and finance chief Mike Woodcock were paid a combined £1.13m last year, equal to 36% of Sanderson's pre-tax profit. 26% of the shareholder vote at the annual meeting went against the remuneration report, as cited in LBV's letter to the board.
| Figure | Value | Note | Claim |
|---|---|---|---|
| Combined pay, CEO Montague and CFO Woodcock, last year | £1.13m | 3 | |
| Share of pre-tax profit | 36% | 3 | |
| AGM vote against remuneration report | 26% | cited in LBV's letter to the board | 4 |
What happened
- Chief executive Lisa Montague and finance chief Mike Woodcock received a combined £1.13m last year, equal to 36% of Sanderson's pre-tax profit, according to City AM.
- LBV founder Emmanuel de Figueiredo called it baffling that Lewis read his comments on pay as attacks on management, and rejected any claim that either executive is unsuitable.
- LBV repeated its objection in a circular to shareholders on Tuesday, saying the board sees its critics as troublemakers instead of stakeholders.
Why it matters
- precedent A reservation of rights from the remuneration chair is now the documented reply to a 14% holder, and any investor weighing public comment on Sanderson pay can see the tone it sets.
- decision Holders voting on the chairwoman and on Stephen Brook are now also judging how the board treated a critic, because LBV has put the letter into its campaign material.
- constraint A legal warning does not change the ratio holders are weighing: pay at 36% of pre-tax profit. The only board statement quoted is about disruption, so the pay case is still to be made.
A remuneration committee chair who answers criticism of pay with legal language is defending the executives and his own committee at once. Patrick Lewis chairs Sanderson's remuneration committee and is an independent non-executive director who has served on the board since November 2021 [5]. The pay in question is £1.13m for the chief executive and finance chief together, equal to 36% of pre-tax profit [3]. Working back from that ratio puts pre-tax profit at about £3.1m [15].
City AM describes Lewis's letter as a threat to sue [2]. The passages it quotes are narrower. Lewis wrote that the allegations in LBV's letter "have the potential to cause serious damage" to the executives [10]. He reserved "all of our rights and remedies", including the right "to seek legal advice and pursue such action as may be appropriate in respect of any defamatory statements that are published" [6]. He added that he hoped this "will not be necessary" and that LBV's concerns "can be addressed through proper and constructive engagement" [7].
The two sides disagree about what LBV said. Its founder, Emmanuel de Figueiredo, said it was "baffling" that Lewis had read his comments on the pay of Montague and Woodcock as "attacks on the executive management team" [8]. In his reply he wrote: "We categorically reject the characterisation in your letter that our comments amount, expressly or by implication, to an allegation that either executive is unsuitable for office and, therefore, defamatory or misleading in any way." [9] The one passage City AM quotes from LBV's original letter calls the 26% vote against the remuneration report "clear evidence of dissatisfaction among shareholders when it comes to board and executive compensation" [4].
Sanderson and Lewis declined to comment [14], so it is open whether the full board stands behind the letter or has answered LBV on the pay figures. Chairwoman Dame Dianne Thompson has addressed shareholders on a different subject. "LBV's proposals risk significant disruption and uncertainty at precisely the point when the benefits of the group's transformation are becoming increasingly evident," she said [13].
LBV has put the letter to use. Its circular to shareholders on Tuesday said: "A board that meets those legitimate views with the threat of legal action appears to believe its shareholders should not hold views of their own." [11] Holders meet on 29 October to vote on removing Thompson and electing Stephen Brook [12]. In our view, on the passage quoted, the legal warning answers a charge LBV denies making, and it gave LBV a governance argument to set beside its strategy one. This quarter the board has to decide whether to answer on the pay figures or stand on the warning. Next quarter, whatever the 29 October result, we'd expect the remuneration report to be read against the 26% vote against the last one [4].
What to watch
- The 29 October vote on removing Dame Dianne Thompson and electing Stephen Brook, and how large the vote against the board turns out to be.
- Whether Sanderson or Lewis answers LBV on the pay figures in public, or the reservation of rights turns into an actual claim.
- Whether LBV's original letter is published in full, since the two sides disagree about whether it questioned the executives' suitability.
Clarity's read
What the record supports and how the coverage leans. The claims behind it follow.
Reality
- Evidence50
- Adoption
- Insufficient
- Hype gap
- Insufficient
- Incentives70
- Confidence55
Claim ledger
Ranked by verification strength, evidence, and original report placement.
- [1]
LBV owns 14 per cent of Sanderson Design Group's shares and has sought to put the spotlight on executive pay following 'years of poor performance'.
- [2]
City AM reported that Patrick Lewis, a Sanderson Design Group board member, threatened to sue the founder of the company's biggest shareholder, warning the boss of LBV Asset Management against 'potentially defamatory allegations' after he questioned executive pay.
- [3]
Chief executive Lisa Montague and finance chief Mike Woodcock were handed a combined pay packet worth £1.13m last year, equivalent to 36 per cent of the company's pre-tax profit.
- [4]
In a letter to Sanderson's board, LBV said the 26 per cent shareholder vote against the remuneration report at the annual meeting was 'clear evidence of dissatisfaction among shareholders when it comes to board and executive compensation'.
- [5]
Patrick Lewis is an independent non-executive director and chair of Sanderson's remuneration committee, and has been a director since November 2021.
- [6]
Lewis wrote: 'I expressly reserve all of our rights and remedies available to us, including the right to seek legal advice and pursue such action as may be appropriate in respect of any defamatory statements that are published.'
- [7]
Lewis wrote that he hoped legal action 'will not be necessary' and that any concerns raised by LBV 'can be addressed through proper and constructive engagement'.
- [8]
LBV founder Emmanuel de Figueiredo said it was 'baffling' that Lewis had interpreted his comments about Montague and Woodcock's pay as 'attacks on the executive management team'.
- [9]
De Figueiredo wrote: 'We categorically reject the characterisation in your letter that our comments amount, expressly or by implication, to an allegation that either executive is unsuitable for office and, therefore, defamatory or misleading in any way.'
- [10]
Lewis wrote to de Figueiredo to warn him that 'the allegations contained in your letter have the potential to cause serious damage' to the group's executives.
- [11]
In a circular sent to shareholders on Tuesday, LBV said: 'A board that meets those legitimate views with the threat of legal action appears to believe its shareholders should not hold views of their own. They see us as troublemakers, rather than as stakeholders to be taken seriously.'
- [12]
Sanderson's investors have been called to an emergency meeting on 29 October to vote on LBV's proposals to remove chairwoman Dame Dianne Thompson and elect Stephen Brook as a director.
- [13]
Thompson has said to shareholders: 'LBV's proposals risk significant disruption and uncertainty at precisely the point when the benefits of the group's transformation are becoming increasingly evident.'
- [14]
Sanderson Design Group and Lewis declined to comment.
- [15]
Combined CEO and CFO pay of £1.13m being 36% of pre-tax profit implies pre-tax profit of about £3.1m.
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Sources
1 independent publisher whose own reporting we read for this story.
- cityam.comBoard member of Royal designer threatens to sue activist investor
1 article · October 14, 2026
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