Peter Sedgwick, chairman of Schroder Investment Management, has defended his company's decision to award a hefty remuneration package to new chief executive Michael Dobson.

Dobson has been awarded share options that will be worth £3.5m (€5.6m) if Schroders' share price doubles in the next five years, as well as annual remuneration of £3.5m every year to December 2004.