Travel company, Thomas Cook received a warning on pay this week at its AGM when the voting results showed that some investors at starting to take a joined up approach to remuneration-related voting. This is a signal to all companies seeking approval for their remuneration policies and new incentive plans this year that shareholders do not want the potential for excessive awards under these schemes.… Read the rest
The US Securities and Exchange Commission (SEC) is seeking comments from companies are encountering as they look to comply with the CEO Pay Ratio disclosure rule which took effect for financial years from 1st January 2017. The rule, hotly debated by business and investors alike, requests companies to disclose the ratio of the median of the annual total pay of all employees to the annual total pay of the chief executive.… Read the rest
The Pensions and Lifetime Savings Association (PLSA), the membership body for UK’s pension funds, has published its AGM Season Report 2016, focusing on executive pay using data provided by Manifest. A survey of PLSA members for the report found that 87% of respondents believe executive pay is too high.… Read the rest
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, Guardian, Telegraph, Sunday Times, and Scotsman have all run more or less the same articles over the weekend highlighting the key features of a proposed Bill:
UK Prime Minister Theresa May appeared to soften her stance on board worker representation within UK companies having previously suggested they should be represented alongside consumers. Speaking at the CBI annual conference this week she said that the government’s coming green paper on corporate governance would address executive pay, shareholder accountability and how “we can ensure the employee voice is heard in the boardroom.”
Addressing worker representation May said: “I can categorically tell you that this is not about mandating works councils, or the direct appointment of workers or trade union representatives on boards.… 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
In sharp contrast to US Republican moves to unwind the Dodd Frank corporate governance reforms introduced after the global financial crisis, the UK’s newly appointed Conservative party leader and soon to be prime minister, Theresa May, has signalled strong support for a progressive corporate governance agenda.… Read the rest
The initial response of the top UK companies to new reporting requirements was not to curb executive pay or improve the link CEO pay and firm performance at FTSE 100 companies, but led instead to “opportunistic reporting for the sake of reputation management,” says a study from Cambridge Judge Business School and King’s College London.… Read the rest
Despite public calls for pension funds to vote against WPP’s remuneration report at its AGM this week (8th June) the resolution was passed with 33.5% dissent – higher than 2015’s 22.2% protest vote.
ShareAction had condemned the chief executive’s (CEO) Sir Martin Sorrell’s £70m pay packet, which makes him the highest paid CEO in the FTSE 100.… Read the rest
Executive pay firm, Semler Brossey, has analysed the relationship between the shareholder support given in elections of remuneration committee members and chairs and the result of the say on pay votes at US company AGMs.
The study of director election results between 2014 and 2016 found that over 80% of director elections have received vote support above 95% and only 0.3% of elections have failed to receive majority support (107 out of 42,499 total elections).… Read the rest
Royal Dutch Shell experienced a relatively modest level of investor opposition to its executive remuneration report at its recent AGM with a 14% vote against, this follows the rival oil company BP’s loss of its pay vote last month. However, Manifest data shows it is the highest level of opposition Shell has received in the past six years – although it hovered between 10% and 11% between 2012 and 2014.… Read the rest
Ferrexpo, which manufactures iron ore pellets which are used in the steel industry, has received a high level of opposition from shareholders to a number of resolutions at its AGM this week (19th May) including those relating to the appointment of non-executive directors.… Read the rest
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