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Reports of potential shareholder unrest at Man Group.

A Times article reports on fund manager anger over an “arms race” in executive pay and juxtaposes this against Man CEO Peter Clarke’s $14.4 mln pay.

It says several institutional investors it contacted “said that they had not yet decided whether to protest over remuneration at Man”.

Man Group’s annual report reveals Clarke received $920,000 in salary, about half that again in pension and benefits, plus a cash bonus of $6 mln in the year to March. In addition, he received $7.4 mln in deferred shares and options, subject to performance.

In the 12 months to March 2008 he received a total package of $27.5 mln, meaning remuneration fell 46 percent on the year.

Man Group’s shares fell 61 percent over the year to March, while the FTSE 100 dropped 31 percent. However, financials have obviously been punished across the board by the market during the credit crisis, rightly or wrongly. Man’s assets under management over the year fell by more than a third, while profits fell roughly 40 percent.

Whether or not shareholder unrest actually emerges, determining how much the executives who make the tough decisions at the helm of Britain’s biggest companies remains a tricky, and inevitably controversial, business. Investors will have to pick their battles carefully.