Proxy advice reforms ‘inoperable’, ‘misguided’: ISS 06 May 2021
One of the main institutional proxy advisers in Australia, has warned against the government’s new proposed restrictions for the sector, with fears independent research could drown in impossible restrictions.
Treasurer Josh Frydenberg recently declared proposed legislation for proxy advisers, aiming for more transparency around proxy advice.
The draft changes have suggestions such as requiring firms to have Australian Financial Services Licences (AFSLs) and to distribute their advice and research on firms they’re the subject of five days before their investor clients see it, as well as alert their clients of how to access company responses.
Rio Tinto shareholders reject executives pay in caves blast backlash
May 6, 2021 10:50 PM PHT
Reuters
A majority of Rio Tinto s shareholders rejected the global miner s executive pay packages on Thursday, May 6, in a backlash over its destruction last year of ancient rock shelters in Western Australia.
Rio Tinto blasted 46,000-year-old rock shelters at Juukan Gorge last May to expand an iron ore mine, sparking condemnation from investors, politicians, its own staff, and the wider community.
Following the company s Australian annual meeting, Rio Tinto said more than 60% of votes cast by investors in the Anglo-Australian dual-listed company were against its remuneration report.
Who checks when super funds cross the line?
Industry super funds are a good example of the age-old agency problem. The Treasurer is right to call for more transparency.
May 4, 2021 – 6.39pm
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The agency problem is one of the oldest in capitalism. Shareholders own the company, and managers act as their agents.
In a widely cited work, lawyer Adolf Berle and economist Gardiner Means described in 1932 how company shareholders were dispersed and passive while company managers and directors worked together.
Super funds want to unseat directors who are not quick enough on climate issues.
Louie Douvis
The separation of ownership from control allowed managers to enrich themselves, or build corporate monuments that may not benefit the owners.
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Corporate leaders say putting new transparency obligations on influential proxy advice firms will avoid unfounded views about companies arising from a lack of consultation.
But prominent fund manager Matt Williams said the reform pushed by Treasurer Josh Frydenberg is an example of âover-reachâ that misunderstands how institutional investors weigh up the advice provided by the research groups.
Alison Watkins, who is readying to depart Coca-Cola Amatil after seven years at the helm, says the reforms proposed by the Treasurer are very sensible.Â
Dominic Lorrimer
Alison Watkins, who is about to bow out of Coca-Cola Amatil after Coke Europeâs $9.8 billion takeover, said the reforms were very sensible and would ensure improved dialogue between proxy advisers and companies.