ARN Media (ASX:ARN) Chairman Hamish McLennan has mounted a staunch primary defence of a proposed $1.1 million cash salary for new CEO Michael Stephenson, despite a sharp collapse in market value and ongoing fallout from the Kyle and Jackie O Show collapse.
The endorsement comes as proxy adviser CGI Glass Lewis urged shareholders to reject the remuneration package at the upcoming annual meeting on May 7, noting the salary sits "materially above the median" for companies of ARN's current scale.
The broadcaster’s valuation has plummeted from a $578 million market capitalisation in 2021 to approximately $90 million today.
This decline has been exacerbated by the legal and commercial vacuum left by Kyle Sandilands and Jackie Henderson, who are currently suing the network for $80 million following the acrimonious termination of their record-breaking $200 million contracts.
Glass Lewis argued the leadership transition in January offered a "missed opportunity" to reset pay in alignment with a company whose shares have slid nearly 14% this year alone.
However, in a detailed 1000-word rebuttal, McLennan argued that the complexity of navigating digital transformation and industry disruption justifies the premium.
He maintained that while financial performance has "underperformed", the board's benchmarking against communication and tech peers validates the $1.1 million figure.
McLennan insisted that securing "capable leadership" is essential to driving a turnaround, even as activists continue to pressure the Kiis FM brand following the high-profile exit of its former star duo.
At the time of reporting, ARN Media’s share price was $0.27.