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
Despite attempts at investor engagement, tobacco firm Imperial Brands has withdrawn the resolution amending its policy at its AGM next week (1st February). The company said that that the decision followed consultations with shareholders, and that the existing policy approved by shareholders at its 2015 AGM will continue to apply.… Read the rest
The UK’s Pension’s and Lifetime Savings Association (PLSA) has advised its pension fund members to act more strongly on executive pay. It is advising funds oppose the re-election of the remuneration committee chair as a company director if they decide as shareholders to vote against a company’s remuneration policy.… Read the rest
Jeremy Corbyn, leader of the UK’s opposition Labour Party has outlined his party’s agenda for governance reform focusing on CEO pay ratios. In a speech in Peterborough last week (10th January) Corbyn added his voice to the current debate surrounding Theresa May’s governance green paper proposals.… Read the rest
Research commissioned by CFA UK has examined the alignment of chief executive (CEO) pay and company value creation between 2003-2014/15 and found that total pay for the median CEO increased by 82% in real terms over the period. However, the median FTSE-350 company generated little in the way of a meaningful economic profit over the period 2003-2009 , and although performance improved from 2010 onwards the median firm generated less than 1% economic return on invested capital.… Read the rest
Investment giant, BlackRock, has indicated it will be toughening its stance on executive pay after giving evidence to the House of Commons’ Business, Energy and Industrial Strategy (BEIS) select committee. In future it will now hold remuneration committee chairmen to account for the decisions they have made; a move which Manifest recommended to the Committee at the previous session.… 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
Huge response to BEIS Select Committee
The UK’s Parliament’s Business, Energy and Industrial Strategy (BEIS) select committee has reported a larger than usual response to its request for written submissions to its corporate governance inquiry. Responses by the main industry bodies and interest groups, firms – including Manifest – together with individual submissions from academics and fund managers have been published on the committee’s website.… 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
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
ShareSoc, which represents individual shareholders in the UK, is advising its members to vote against the remuneration report of house builder Berkeley Group at its AGM on 6th September.
Tony Pidgley, co-founder and executive chairman, of Berkeley, received £21m in the financial year ending 2016 and £23m in the previous year.… Read the rest
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