Midlands software company Misys is likely to face a shareholder rebellion next month over plans to pay two board members £1.2 million in loyalty bonuses.
The company chose to offer the awards to two divisional directors - head of healthcare, Tom Skelton and head of banking, Ivan Martin - in a bid to stop them leaving if they are passed over for the chief executive position.
Several institutional investors are planning to vote against the proposal to award the loyalty payments at next month's annual general meeting.
The Association of British Insurers, whose members control about a fifth of the United Kingdom stock market, has published "red-top" guidance on the proposed awards - its highest level of concern.
Misys, based at Salford Priors, near Evesham, proposes to offer the two directors executive shares valued at £600,000 in four years if they meet their business strategy targets.
The same amount would also be offered after three years if the two men hit performance targets based on divisional operating profits.
Misys is looking for a new chief executive to replace Kevin Lomax who is also founder and executive chairman of the group.
Mr Lomax plans to become non-executive chairman by 2008.
A substantial Misys shareholder, which did not wish to be named, said: "We are not supportive of the retainer bonus.
"We also have broader concerns about Mr Lomax's move to non-executive chairman, which we know other institutional shareholders also have."
Earlier this month it was revealed that Mr Lomax had benefited from a substantial pay increase for the year.
The Misys founder saw his salary doubled to £1,004,984 for the financial year 2004/5 against £435,523 in 2003/4.