steel group Corus faced the wrath of investors yesterday over its chairman's 130 per cent pay rise.

Sir Brian Moffat was paid £558,846 in basic pay and fees last year, compared with £302,818 for the previous 15 months.

The revelation earlier this month caused anger among unions. Corus, which employs about 3,000 on Teesside, axed 6,000 jobs and froze workers' pay last year in an attempt to slash costs.

The move also infuriated the Co-operative Insurance Society, an institutional investor which yesterday showed its displeasure at Corus's annual meeting in London.

CIS voted against the re-appointment of Eric van Amerongen, non-executive director and remuneration committee member. The pay rise was not put to a vote.

Ian Jones, head of corporate governance at CIS, said the increase was "highly inappropriate" in light of Corus's "severe financial difficulties".

He added: "To have such a significant difference between the remuneration practices for executives and employees poses significant reputational risk to Corus, a risk that is passed on to employees and shareholders alike."

Mr Jones conceded Sir Brian's award was in line with industry averages - he had a combined role of chairman and chief executive last year - but said it still posed a risk to the company and to employee morale.

Mr van Amerongen was reappointed by 1.72 billion proxy votes although Corus received 23 million proxy votes against.

Corus said the increase recognised Sir Brian's dual role, and that his salary had been reduced after the appointment of a chief executive. Sir Brian is now paid a basic salary of £245,000 per year.

Corus also updated investors on trading. It has been rocked by the tough global economic climate but said it had seen some price recovery in the US during the three months to March.

It had been prompted by the threat of import sanctions by the US Government. Since their introduction last month, Corus added, there had been a "significant" further increase in selling prices.