Pirc, the activist corporate governance watchdog, has joined a nascent shareholder rebellion against the pay packages of Royal Bank of Scotland's new chairman and chief executive, following a similar warning from the Association of British Insurers at the weekend.

Pirc said the award of 10.4 million shares to Stephen Hester, who replaced the disgraced Sir Fred Goodwin as chief of the nationalised bank in November, should be voted down since there were no performance conditions attached to it.