Press release 108 – Small shareholders renew bid to make RBS a better run company
RBS Shareholders Requisition Shareholder Resolution for a Shareholder Committee.
- Over 100 shareholders in the Royal Bank of Scotland (RBS) have requisitioned a resolution to install a “Shareholder Committee” at the company, which will include shareholder representatives, to improve the corporate governance and shareholder engagement at RBS.
- RBS will now have to put this proposal to a vote at their Annual General Meeting (AGM) in May 2019.
- ShareSoc and UKSA have supported and coordinated this and delivered the resolution and a large bundle of associated requisition forms to RBS’s London office on Tuesday 18 December at 10.00am.
- Third year of campaign.
Why are ShareSoc and UKSA doing this?
Mark Northway, ShareSoc Chairman said “Shareholders deserve a new approach; one with greater involvement and more effective input from them as ultimate owners. RBS, given its track record and consequent taxpayer support, should now be leading from the front in governance matters.”
Cliff Weight, Director of ShareSoc who has coordinated the campaign said “The current method of engaging between shareholders and listed UK companies doesn’t work. We think our proposal at RBS is a good starting point and an example for others to follow.”
A similar resolution was submitted to the 2018 AGM. There were 604.99 million votes in support of the proposal, representing 5.5% of the non-UKGI votes cast. UK Government Investments(UKGI), which represented 75.3% of the votes cast on this matter, chose to vote against the resolution, thereby deciding the outcome.
The UKGI position at the 2018 AGM was a disappointment to the campaign, and arguably inconsistent with the entity’s mandate. The Government wishes to reduce and eventually eliminate its stake in RBS, and any means of increasing engagement with shareholders should be embraced with enthusiasm. Increased shareholder oversight through a Shareholder Committee can only make the shares more attractive to prospective investors.
5.5% support for the resolution was a significant outcome in light of the negative recommendation from the Board of RBS. It was a truly remarkable result.
ShareSoc and UKSA recognise that it takes time to influence the thinking of the Board, of UKGI and of institutional shareholders. The first vote on this matter was held at the 2018 AGM. We can expect increased support for the proposal at the 2019 meeting. Change does not happen overnight.