Manifest, a proxy advisory service, have reported on the voting at Annual General Meetings recently. It was good to read that there was significant opposition to the change to 14 days notice at the General Meetings of both Arm and Anglo-American – 18% at the latter and even higher at the former. This commonly arises where there are substantial overseas holders who find difficulty in getting in their proxy votes in time because of the complexity of the voting chain. But the surprise is that there is not much higher opposition from private shareholders to this desire by companies to override European Directives and move to 14 days from 21. Has there ever been an example where 14 days was really critical to a company? And if the vote is of that importance, it is surely important that everyone gets the opportunity to vote.
Opposition is rising to companies putting such resolutions on the agenda and shareholders should certainly think about it before they vote “Yes” rather than “No”.
But the bad news is that opposition to remuneration reports or policy seems to be more muted of late. Now shareholders actually have a vote, they seem reluctant to use it to oppose over generous pay schemes. This appears to be a wish not to offend the sensibilities of the board of directors, or simple unwillingness to get to grips with the complexities of modern remuneration schemes, rather than any real examination of the issues. This was reflected yesterday at the BG Group AGM where only one in five shareholders opposed the remuneration report (ShareSoc director Mark Bentley spoke at the meeting against the package of £11.7m that might be received by Mr Lund – we hope to report on this more, but it was widely covered in the national media). Although it was widely reported as significant opposition, why did anyone vote to support the remuneration report when it is only advisory in any case? It is this kind of weak opposition to outrageous pay schemes that mean they still get put forward by remuneration committees and approved by boards. Plus of course requested by management who are receiving them.
Roger Lawson
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