The National Association of Pension Funds (NAPF) has recommended that Burberry chairman John Peace should be voted off the board of the up-market retailer.

NAPF has pointed out that Peace is not independent as he is also chief executive of GUS, which owns Argos and is a controlling shareholder in Burberry.

In a report to its members, the association said: "This is not in line with the New Combined Code and, while we understand the company's view, it is not in line with best practice."

Burberry will also be questioned about its remuneration report, which recommends that long-standing executives will receive two shares for every new share that they purchase.

NAPF believes that a shareholder vote should have been held over the incentive scheme, especially as it is not connected to any new performance targets.

A spokeswoman for Burberry said the scheme was being introduced to "attract and retain high quality people."

She said: "John is a first-class chairman and under his stewardship the company has shown that it can attract and retain top talent as well as deliver a strong financial performance."

At 2003's annual general meeting, NAPF asked its members to vote against Burberry's "extraordinary" executive pay arrangement.

The company has this year reported rises in profits, margins and turnover.