The British press were this weekend widely tipping that the publication of Theresa May’s flagship corporate governance reforms will be published this week. The BBC
, Sunday Times
, and Scotsman
have all run more or less the same articles over the weekend highlighting the key features of a proposed Bill:
- A requirement for companies to publish pay ratios showing the difference in pay between the chief executive and average employee;
- Improving the effectiveness of remuneration committees and the extent to which they must consult shareholders and the wider company on pay;
- Employee advisory representation on remuneration committees;
- A binding annual shareholder votes on executive pay packages; and
- Private company directors will be subject to a new code of conduct on behaviour and transparency.
… Read the rest
Shareholders of Australian companies are showing their muscle in this year’s proxy season with significant opposition votes over the governance of retailer Harvey Norman
and a rejection of executive pay at the Commonwealth Bank of Australia
The Australian Shareholders Association has called on the chairman of Harvey Norman, Gerry Harvey, to resign and for an independent non-executive director to replace him.… Read the rest
UK fund managers members take executive pay reform seriously according to the UK’s Investment Association,
which this week responded to the recommendations of the Executive Remuneration Working Group.
In its new Principles of Remuneration, the IA suggests that rather than opting for the default Salary/Bonus/Long Term Incentive Plan (LTIP) pay structure, firms should consider pay structures which fit their business and strategy.… Read the rest
Australian entertainments group, Ardent Leisure
, held its AGM just two days after an accident at its theme park Dreamworld
in which four people died and two children were injured on a river rapids ride. The out-going chairman, Neil Banaves, offered sincere condolences to the victims and their families but said that despite the seriousness of the incident they were still required to convene the AGM as planned.… Read the rest
UK investment campaign group ShareAction has urged investors to use the binding votes on remuneration policy at BP and Shell in 2017 to ensure the oil majors can demonstrate their commercial strategies are aligned with a move to a low carbon economy. … Read the rest
The House of Commons’ Business, Innovation, and Skills (BIS) Committee has launched an inquiry on corporate governance, focussing on executive pay, directors duties, and the composition of boardrooms, including worker representation and gender balance in executive positions.
This follows the committee’s inquiries into the corporate collapse of retailer, BHS, and the working practices at Sports Direct and the announcement by Theresa May that the government will be consulting on corporate governance issues this autumn – including her proposals on executive pay and employee representation on company boards.… Read the rest
The UK has the second-least meritocratic bonus system in the world, according to a global poll of 6,500 financial decision makers carried out by the Chartered Institute of Management Accountants (CIMA). The organisation is calling for bonus systems to be designed to encourage long-term success rather than only short-term performance.… Read the rest
The TUC has claimed that it took the the UK’s highest paid chief executive (CEO), Martin Sorrell, less than 45 minutes to earn what an average UK worker earns over an entire year, following its analysis published at its annual congress
held this week.… Read the rest
Prime Minister Theresa May, speaking at the end of her first G20 summit held in Hangzhou, China, pledged to bring forward a consultation paper this autumn suggesting reforms to corporate governance at UK companies.
This indicates that May will be taking action on issues she first raised at the start of her campaign to stand as Conservative Party leader and which she believes fit with her pledge as Prime Minister to govern in a way that benefits everyone and gives them a share of economic improvements and increased prosperity.… Read the rest