Overseas owners prompt audit rethink

The increasing foreign ownership of UK companies is forcing the UK’s reporting watchdog the FRC rethink the role of audit and market oversight.

Stephen Haddrill, chief executive of  the Financial Reporting Council, speaking to senior finance figures this week said that  he would canvass opinion on the adequacy of the audit report, whether there needs to be more assurance around risks and if auditors can open dialogue with investors.… Read the rest

ASX Governance Code under review, calls for more female directors

The Australian Corporate Governance Code is up for review. Under the auspices of the Australian Stock Exchange (ASX), a number of amendments are under consideration, most notably improved disclosures about gender diversity and executive pay.

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Mercer strengthens Responsible Investment unit

Will Oulton is leaving his role as director of Responsible Investment at FTSE Group to join Mercer’s investment consulting business as European Head of Responsible Investment.

Oulton will start his new role at Mercer in May when he replaces Emma Hunt, Mercer’s former head of responsible investment for Europe who left to join rival advisor Towers Watson in February.… Read the rest

Soc Gen rebuffs Chair/CEO split call, but was it legal?

French SICAV Proxy Active Investors is crying foul over the high handed dismissal of its proposal to separate the chair and CEO roles at Société Générale.

On April 7th 2010, PhiTrust, the managers of Proxy Active, and a group of international institutional shareholders filed a resolution requesting a statue change to split the roles.… Read the rest

Xstra-ta very much

Xstrata may find that its remuneration report resolution hits the headlines yet again on May 5th. Against a backdrop of general public hostility towards high director bonuses and greater shareholder scrutiny on remuneration reports resolutions, resulting in higher levels of dissent (“Against” votes plus abstentions), Xstrata’s board will likely again need major shareholder, Glencore International, to come to the rescue to ensure shareholders give the Remuneration Report resolution majority support.… Read the rest

Shareholder rights a ‘key reform’ says Obama

US president Barack Obama took his fight for financial reform to the heart of Wall Street this week and described the role of shareholders as “the last key component”.

As the US administration faces up to a tough fight in the Senate on Monday, Obama outlined his vision of a financial system that did not “have to choose between markets that are unfettered by even modest protections against crisis, or markets that are stymied by onerous rules that suppress enterprise and innovation.”

President Obama currently has a 59-41 Democrat majority over Republicans in the Senate, one vote short of what is needed to take the Bill forward.… Read the rest

FRC: Game-keeper turns poacher

As the consultation on the UK’s Stewardship Code draws to a close, the UK’s reporting regulator, the FRC, has moved to strengthen its secretariat with the appointment of ABI governance veteran, Peter Montagnon.

Montagnon will join his former ABI boss Stephen Haddrill, on June 1st.… Read the rest

Commission threatens action on shareholder rights laggards

The European Commission has recently announced it intends to initiate processes for taking action against EU Member States over implementation of the Shareholders Rights Directive (SRD). The Directive, which was passed in 2007, establishes Europe-wide principles for ensuring certain basic rights of shareholders at European listed companies.… Read the rest

Italian mergers, boards & governance – possibly not the best way

Intesa Sanpaolo, Italy’s biggest retail lender and the by-product of the takeover of Sanpaolo IMI by Banca Intesa is an excellent case study of a) how not to construct a post-merger board and b) how not to engage with shareholders and c) why EU shareholder reforms can’t come too quickly.… Read the rest

Manifest welcomes FRC’s role in Stewardship Code

Manifest has welcomed the Financial Reporting Council’s role as the new guardian of an institutional investor Stewardship Code but has proposed that the Code itself should be the subject of its own consultation rather than a simple grandfathering of the existing ISC principles.… Read the rest