Tabcorp CEO Pay Plan Backed Despite Shareholder Scrutiny

Tabcorp Holdings has drawn attention on the ASX after shareholders backed a multimillion-dollar pay package for Chief Executive Officer Gillon McLachlan. Despite pushback from the Australian Shareholders’ Association (ASA), investors voted overwhelmingly in favour, showing renewed confidence in the company’s leadership and direction.

Shareholders Back McLachlan Despite ASA Pushback

At Tabcorp’s Annual General Meeting on 20 October 2025, shareholders gave near-unanimous approval to the company’s pay resolutions. Around 96 per cent supported McLachlan’s long-term incentive plan, while 99 per cent approved the annual pay report outlining executive compensation.

The ASA had urged retail investors to reject both resolutions, calling the scheme excessive and opaque. Under the approved arrangement, McLachlan could earn up to AUD 18 million by 2027 if Tabcorp’s earnings rise by 10 per cent and the share price holds near AUD 1.07. His base salary of AUD 1.5 million and AUD 1.65 million annual bonus already put him among the top-paid executives in Australia’s gambling sector.

The board defended the package, saying it reflected performance, market competitiveness, and the company’s turnaround since McLachlan’s appointment.

A Company Rebounding From a Troubled Past

Tabcorp’s support for McLachlan is also a vote of faith in its recovery. As one of the leading Australian online betting platforms, Tabcorp operates the country’s biggest retail betting network alongside its TAB app and website, competing with major global brands such as Sportsbet, Ladbrokes, and bet365.

Once labelled the “sick man of the ASX,” Tabcorp recorded two straight years of losses exceeding AUD 600 million before McLachlan arrived in 2024. The 2017 merger with Tatts Group and its 2022 demerger left the company fragmented and struggling to find direction.

Under McLachlan’s leadership, performance has improved sharply. In FY2025, revenue rose 11.8 per cent to AUD 2.6 billion, while net profit after tax jumped 76.8 per cent to AUD 49.5 million. Cost savings reached AUD 31 million, and debt fell by AUD 250 million. Tabcorp’s share price has more than doubled since mid-2024, climbing from 39 cents to around AUD 1.06 — its highest level in years.

The recovery has reassured investors who watched the company lose ground to faster-moving online rivals.

The AFL Legacy and a Coach-Style Approach

McLachlan’s leadership style reflects his decade as head of the Australian Football League. Known for his structured, performance-driven approach, he has applied similar principles at Tabcorp.

During his AFL years, league revenues more than doubled, broadcast rights hit record levels, and the AFL Women’s competition was launched. At Tabcorp, he’s used that same discipline to sharpen focus, streamline operations, and rebuild morale.

The business has refocused on core wagering and media services, prioritising digital growth and retail modernisation. Internally, the company has adopted a “back-to-basics” mindset that rewards accountability and execution rather than expansion for its own sake.

Why the ASA Objected

The ASA remains critical of Tabcorp’s pay structure, warning that option-based incentive plans can lead to outsized rewards when share prices rise. McLachlan’s 30 million options are priced at 47 cents, less than half the current share value, meaning his potential bonus could equal half of the company’s annual profit.

The group also objects to the “cash-equivalent” nature of the options, which do not require him to buy or hold shares directly. Governance experts say such schemes risk weakening the link between executive pay and long-term shareholder value.

Institutional investors, who hold most of the voting power, took a more pragmatic stance. They’ve seen rapid share-price growth and a return to profitability, outcomes that appear to justify the rewards.

The Broader Pay Debate

Tabcorp’s AGM fits into a wider discussion on executive pay across the ASX. Retail investors have become more vocal about packages they view as excessive, while boards argue that competitive incentives are necessary to attract capable leaders.

In industries such as gambling and wagering, where regulation, technology, and competition change fast, strong leadership can be the difference between growth and stagnation. For many investors, McLachlan’s results outweigh concerns about the size of the package.

Strategic Priorities Ahead

Beyond the pay headlines, Tabcorp is pursuing several key projects. The company is pushing for a national tote system to merge Australia’s fragmented state-based parimutuel pools into one. The move would boost liquidity, improve odds for punters, and help TAB compete with international betting platforms.

The group also expects steady gains from its new Victorian wagering licence, secured in 2024, and improving conditions in Queensland and New South Wales. Capital expenditure is forecast between AUD 120 million and 140 million, with next year’s revenue projected at around AUD 2.7 billion.

Final Thoughts 

For now, the numbers speak for themselves. Shareholders have backed McLachlan’s strategy and leadership, giving Tabcorp room to keep building on its recovery. The ASA’s concerns highlight a valid debate about fairness and transparency, but the near-unanimous vote shows that investors are focused on results.

Whether McLachlan ultimately earns the full AUD 18 million remains to be seen, but under his leadership, Tabcorp has regained stability, confidence, and momentum,  a far cry from the uncertainty it faced just a year ago.