When asked by a shareholder at the company's annual general meeting yesterday what the justification for the payment was, deputy chairman and senior independent director Garry Watts said the board felt it was the right thing to do.
At Perth Concert Hall, Mr Watts said: "The thinking of the board on this is that when we asked Sir George Mathewson to be chairman there was an understanding that he would serve for a longer period than he ended up serving for.
"We felt there was an obligation - not a legal one - and felt that it was the right thing to do [to make the payment]. We try to do the right things at Stagecoach."
The payment was made on top of Sir George's £165,000 annual fee for chairing the transport giant.
Earlier in the meeting, Sir Brian Souter, who succeeded Sir George on May 1 this year, paid tribute to his predecessor, saying Stagecoach had benefited greatly from his "business insight" over his seven years chairing the board.
Although the remuneration report was accepted at the AGM, some investors did voice their discontent with 6.5% voting against the document. Almost every other resolution at the meeting was passed with near- unanimous support.
Only the re-election of Phil White as a director, with 6.3% voting against it, and Sir Brian's re-election, which saw a 3.1% vote against, suggested any shareholder discontent.
During a question and answer session, shareholders quizzed the board on several aspects of the business, ranging from expansion plans to potential impacts of speed calming measures on roads. Chief executive Martin Griffiths said the group was comfortable with its UK and North America focus but admitted other markets are being considered and acquisitions were a possibility. He said: "We are very happy with the current geography of the group. We do not rule out Europe and our London Megabus already does some cross-channel services."
Asked specifically about expansion in British Columbia in Canada, he said the regulatory environment in the region was not helpful but said Megabus operations in other states were doing well. The board were also asked whether they would consider moving the company's AGM outwith Scotland. Sir Brian said having it in London would probably be easier for many board members as they spent much of the week there working.
However he felt moving the meeting away from Perth would mean a lot of shareholders would no longer be able to attend but said the board would give the idea "a wee bit of thought".
It was confirmed Stagecoach has this week extended four bus contracts in London and won an additional two routes.
Sir Brian said: "It is important we keep winning business in London."
Addressing shareholders, Sir Brian said he believes Stagecoach is well positioned for further growth.
He said: "The group remains in a strong financial position and I believe we can look forward to the next chapter in the Stagecoach story."
After the meeting, Sir Brian said he was enjoying the change of pace since moving from chief executive to chairman.
He said: "We have a very good team and I am very comfortable with it. Chief executive of Stagecoach is quite a demanding role. Martin has been finance director for 13 years and has very good credentials and is very well liked within the company.
"It is more an evolution than a revolution."
Souter Investments has been active in recent months with multi-million pounds disposals of its stakes in luxury yacht maker Sunseeker and biodiesel maker Argent Energy. Sir Brian said: "[Being more active at Souter Investments] is part of the reason I wanted to go to the chair role."
However, he ruled out taking on other corporate non-executive appointments and added: "My main focus is on the family investment. That is what I enjoy doing."