The history of Cable & Wireless is littered with management oustings, profit warnings and strategy u-turns. Recently the group had looked to be setting itself on a more stable footing as it moved towards its goal of demerger.

But the abrupt ousting today of John Harris, the group’s international head, ensures that any of the plus points in the interim results — including the better than expected performance of the UK division, with operating profits of £99 million — will be overshadowed once again by C&W’s boardroom politics and payment controversy.

If investors are untroubled by the decision to allow John Pluthero, the UK head, to assume control over the entire group — the group’s stock was up more than 3 per cent this morning — corporate governance bodies are unlikely to feel that way.

Under the company’s controversial incentive scheme, the ousting of Mr Jones means that Mr Pluthero now stands to gain an even bigger pot of money if he either hits certain targets or sees the group through a sale.

Questions had already been raised about whether Mr Pluthero’s potential reward under the scheme — of more than £20 million — was excessive and the subject triggered a fierce debate in the run up to C&W’s annual meeting this summer.

Now, half of Mr Harris’s remaining share of the scheme will be transferred to Mr Pluthero enabling him, potentially, to enrich himself further.

And what of Mr Harris’s large pay-off? His abrupt departure — he leaves by the end of the year — came as the group revealed that the performance of its international division was failing. Today the group reduced its guidance for the division by $20 million. Even so Mr Harris, who has been at the group for just three years, will leave with more than £5 million — including what is due to him under the remuneration scheme so far because, the group says, he is a "good leaver".

At its annual meeting C&W saw-off a rebellion over its controversial pay and perks policy. Today that subject has risen back to the top of the company’s agenda.

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