2nd UPDATE: PIRC Recommends AstraZeneca Holders Oppose Report

(Adds AstraZeneca comment)

LONDON -(Dow Jones)- Shareholders of U.K. pharmaceuticals company AstraZeneca PLC (AZN) should vote against the company's report and accounts because it is donating too much to U.S. political parties and is awarding executives too much in bonuses, U.K. advisory group PIRC said Wednesday.

PIRC said AstraZeneca contributed $815,838 this year to U.S. state political party committees and campaign committees of various state candidates affiliated with major political parties, and is also seeking authority for additional political donations and expenditure up to $250,000.

"We do not consider political donations to be an appropriate use of shareholders' funds. Therefore we recommend that shareholders oppose the company's report and accounts to express concern," it said.

In an emailed statement, AstraZeneca said it adheres to all applicable laws when dealing with political donations, noting that any interactions between its employees and government officials must comply with strict internal policies.

AstraZeneca's U.K. rival GlaxoSmithKline PLC (GSK) said in December 2008 that it will no longer use corporate funds for political contributions in the U.S. as part of an effort to improve openness in its business, after stopping making corporate political contributions in Europe in 2001.

However, GlaxoSmithKline's policy change won't apply to individual employee's contributions, including a voluntary political-action committee run by employees.

PIRC also said shareholders should oppose AstraZeneca's remuneration report because it has significant concerns that executive bonuses, options and performance share schemes are excessive at over six times aggregate salaries. It also said the performance conditions aren't tough enough.

AstraZeneca's Chief Executive David Brennan received compensation of $4.7 million in 2008, representing a 9% increase over his salary package in 2007.

AstraZeneca said all decisions made by the remuneration committee are based on the performance of the individual as well the whole business, which in 2008 delivered "strong financial and operational results on many fronts."

-By Steve McGrath and Elena Berton, Dow Jones Newswires; 44-20-7842-9284; steve.mcgrath@dowjones.com; elena.berton@dowjones.com

(END) Dow Jones Newswires

April 15, 2009 09:58 ET (13:58 GMT)

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