Companies need to identify ways to make annual general meetings (AGMs) transparent, ethical, and effective.
In recent weeks, the Australian Council of Superannuation Investors (ACSI) published their annual review of CEO pay in the ASX 200. Research is conducted on the organisation’s behalf by Ownership Matters, an Australian governance advisory firm.
Our last research report dealing with the cost of governance was published in July 2014. Recent discussions arising from our advisory work and highlighted in Board responses from comments made by institutional investors and their advisers and issues recently arising in the Royal Commission into the financial services sector, have made several supplementary issues front and centre.
Senior executive’s fixed or come-to-work remuneration among Australia’s leading companies has been in decline over the last decade.
This article was triggered by an enquiry from Patrick Durkin of the Australian Financial Review, responding to comments by the former Treasurer, Wayne Swan, that Chief Executive pay is “out of control”.
Having reviewed the statement prepared by the ASX 200 Boards in relation to Director capability, incorporating skills and experience, we have noted indicatively two approaches.
With comments from proxy advisers, major institutional investors and shareholder activists questioning Directors’ (particularly Chairmen’s) capacity, to serve on more than three or four Boards for which they will often receive more than $1 million in annual fees, the community should not be aggrieved with the level of reward paid to our Prime Minister, our Premiers or our Ministers.
When ASX listed companies seek independent counsel on remuneration issues, remuneration advisers can find themselves faced with numerous scenarios which can result in conflict with a departing Executive, especially where the level of compensation as part of a separation or nominal resignation is being discussed.
Among the top 300 listed companies by market capitalisation*, there were six companies that experienced a significant shareholder vote against their Remuneration Report during the final quarter of the 2017 Annual General Meeting season.
The first Newsletter of the 2018 calendar year provides not only comment on contemporary issues, but also includes comment on the 10 most popular articles over the last 60 editions of our Newsletter and the most widely read Key Management Personnel Reports (KMP Reports) of the past 5 years.