Myners has a long and public record of concern about the state of corporate governance, shareholder activism and voting. A self-declared “City Outsider”, he appears to take a particular delight in being provocative and shaking up the status quo. Earlier this year he went on record saying: “I want to encourage responsible and engaged shareholders, not shareholders that act like absentee landlords”.
Well we now have three proposals in the ring, the latest being revealed in a letter to the financial news website BreakingViews.com. In his latest suggestion, Myners said that current stakeholders could be given a 1-for-1 issue of non-voting shares, which could then be traded in the market alongside voting shares.
Earlier this week said that shareholders who never use their right to vote should be given a chance to sell the rights to more active investors.
And of course we had his first proposal, as revealed in an interview with Robert Peston of the BBC, namely that that banks should give enhanced voting rights to their more loyal shareholders.
All these proposals are, however, fraught with difficulty in both the operational and philosophical sense. Investors have campaigned long and hard to eliminate differential voting rights and the idea that votes could be bought could well lead to issuers buying in their own votes to see a particular strategy prevail against the wishes of the real owners.
Shareholders have frequently needed to be spurred into action to take governance more seriously. So even if Lord Myners’ holiday post cards are off the mark, they have at least had one effect – getting the debate going. Unfortunately most of the debate has been reasons why none of the suggestions would work rather than alternative proposals that could.
It’s one thing debating what investors “should” be doing, the real challenge is to get more of them to do it.