POWERED BY MOMENTUM MEDIA
Antiquated systems undermining institutional votes
Old fashioned manual, paper-based voting systems are undermining the validity of shareholder votes on corporate governance issues such as executive remuneration, according to new research released by AMP Capital Investors.
The research, released this week, suggests that votes on corporate governance issues are being lost as a result of the manual system, with up to 4 per cent of ballots being misplaced, with the real figure likely to be much higher.
The research found that a significant proportion of institutional shareholder votes on corporate governance issues were still appearing to be lost and that many of the votes might have helped determine the outcome of shareholder resolutions, including those on executive and board remuneration.
Commenting on the research, AMP Capital Investors director of sustainable funds Michael Anderson said the report highlighted the impact that lost shareholder votes could have on corporate governance.
"There are a number of ways in which the current, largely manual, voting system can fail its stakeholders," he said. "However, the widely-discussed solution of updating to real-time electronic vote registration should substantially reduce the number of shareholder votes that are lost and in turn boost the overall levels of corporate governance."
The latest AMP Capital Investors research suggests that good pay practices and remuneration incentives were paying dividends by rewarding company management who produce better shareholder performance.
However, it noted that remuneration remained the most contentious corporate governance issue, with incentive issues not supported at 43 per cent of meetings, while 39 per cent of votes on remuneration reports were not supported.
AUTHOR
Mike Taylor
Recommended for you
Jim Chalmers has defended changes to the Future Fund’s mandate, referring to himself as a “big supporter” of the sovereign wealth fund, amid fierce opposition from the Coalition, which has pledged to reverse any changes if it wins next year’s election.
In a new review of the country’s largest fund, a research house says it’s well placed to deliver attractive returns despite challenges.
Chant West analysis suggests super could be well placed to deliver a double-digit result by the end of the calendar year.
Specific valuation decisions made by the $88 billion fund at the beginning of the pandemic were “not adequate for the deteriorating market conditions”, according to the prudential regulator.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
Spire Oaktree Opportunities XI Second Close
61.07 3 y p.a(%)
2
Spire Oaktree Opportunities XI First Close USD
59.21 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.56 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.06 3 y p.a(%)
5
DomaCom 4/27 Crombie Avenue Bundall QLD 4217 Australia
26.81 3 y p.a(%)
