The Local Authority Pension Fund Forum (LAPFF) has urged its members to oppose Barclays'
The awards for the chief executive are hard to justify given the bank's poor performance, it said in a statement, also flagging a 5.7 million pound tax equalisation payment made to offset the tax impact of Diamond's relocation to the UK as an issue of concern.
We believe the company needs a clear signal from shareholders that a different approach is required in future, said Ian Greenwood, chairman of the Forum.
This week Barclays said half the long-term bonuses awarded to its top two executives would depend on the British bank hitting key profitability targets, following resistance from investors to its original proposals.
Bonuses for 2011 for Diamond and Finance Director Chris Lucas are due to pay out in shares over three years, a third in each year.
The new condition means half of the award that may vest in each year will not now pay out until the bank's return on equity exceeds its cost of equity.
Barclays said the change followed talks with a number of major shareholders in recent weeks and the strength of opinion expressed by some shareholders in the meetings.
(Reporting by Tom Bill. Editing by Jane Merriman)