Analysis: Real Test Ahead For Bankers' Pay

It was Bob Diamond, the chief executive of Barclays, who famously said that the period of post-financial crisis remorse from bankers needed to be over.

So the apology from Marcus Agius, Mr Diamond's chairman, for the mishandling of Barclays' latest pay round, was a significant expression of contrition.

Mr Agius, who also chairs the industry-wide British Bankers' Association, told shareholders at Barclays' annual meeting in Central London that the bank had "not done enough" to explain its decision-making on pay.

That was self-evident: around 30% of the votes cast on Friday did not approve the Barclays remuneration report, and of those cast either for or against it, almost 27% opposed the board's policies.

Mr Agius pledged to engage much more closely with investors in future to avoid a repetition of the damaging row which produced one of the biggest shareholder revolts against a FTSE 100 company's remuneration report for some time.

But while Mr Agius apologised for the communication of the £2bn-plus paid by Barclays in staff bonuses for 2011, he exhibited little regret for the absolute sums being handed out.

It is that attitude which has angered some of the largest institutions in the City, including Aviva Investors, Legal & General Investment Management, Schroders and Standard Life Investments.

Robert Talbut, who as chairman of the Association of British Insurers' investment committee holds one of the most powerful shareholder voices in the City, said: "(Friday's) outcome clearly shows the investor concern with the company's remuneration policy.

"Investors take executive pay very seriously. Getting it right is an important part of a successful company.

"All banks face a challenge to improve their investment case by getting a better balance of returns to shareholders, payments to employees and capital retention.

"We welcome the chairman's [Mr Agius's] promise to engage more closely with shareholders and we will continue to work with the company on improving the investment case."

With the Government urging City shareholders to become increasingly activist amid reforms to the way executive pay is policed, it was inevitable that they would feel a need to demonstrate robust opposition to companies perceived to be flouting best practice.

That said, none of those major Barclays shareholders spoke out at the AGM, and it was left to individual shareholders to make the case against the pay deals awarded to Mr Diamond and senior colleagues.

At times a hostile audience, the meeting nonetheless did not escalate into the kind of conflagration feared by Barclays directors in recent weeks.

With binding votes on executive pay now looming large on the horizon, it may be that the real tests for Barclays - and others - to demonstrate that they are not deaf to the views of shareholders are still to come.