Sainsbury's stocks �50m worth of Cadbury products

The supermarket has given Bob Stack from Cadbury Schweppes a key role on the committee which supervises the pay of Sainsbury boss Justin King.

Cadbury supplies Sainsbury with about �50m of sweets and drinks a year.

Fund manager Morley, which owns 2% of the firm, has spoken to Mr Hampton and is now satisfied, reported The Times.

Controversial issue

The question of remuneration is controversial for Sainsbury's.

Shareholders were angered by a �2.5m pay off for Sir Peter Davis, its former chief executive and chairman, who presided over a period of poor results.

Earlier this month, Sainsbury recruited Mr Stack as one of two non-executive directors.

Mr Stack, who is chief human resources officer of Cadbury Schweppes, will chair the company's Remuneration Committee from the beginning of 2005.

The Times said Morley did not believe Mr Stack would face any conflict of interest in his job, though suppliers often want to keep on good terms with major customers.

However, the National Association of Pension Funds plans to look at the appointment of Mr Stack in advance of Sainsbury's annual meeting in July, when investors will vote on it.

Mr Stack joined Cadbury Beverages in the US in 1990 and joined the Cadbury Schweppes board in May 1996 as group human resources director.

However, since March 2000 he has also been in charge of Cadbury's communication and external affairs as well as being its chief human resources officer.

In 2001 he hit the headlines himself as Britain's highest-paid personnel manager with a �1.25m package.