Welcome to the May 2010 issue of GuerdonNews®
In this issue we:
• Describe the ASX Corporate Governance Council’s exposure draft of proposed amendments to ASX Corporate Governance Principles and Listing Rules impacting pay governance
• Summarise and comment on the government’s response to the Australian Productivity Commission’s inquiry into executive pay
• Lament the government response to the Australian Board of Taxation review of employee share schemes
• Highlight outcomes from the Financial Stability Board (FSB) peer review that point to what APRA may emphasise next in banker pay
We conclude with the latest on executive and director remuneration disclosure updates available on the GuerdonData® on-line database and references to Guerdon Associates in the news media.
Proposed amendments to ASX Corporate Governance Principles and Listing Rules
On 22 April 2010 the ASX Corporate Governance Council (CGC) issued an exposure draft of amendments it is proposing to make to its Corporate Governance Principles and Recommendations.
It is proposed that any changes in the reporting requirements will apply to an entity’s first financial year commencing on or after 1 January 2011, but the Corporate Governance Council is encouraging early adoption, especially in the case of the recommendations on diversity.
The CGC’s background for the proposed changes are summarised in this article.
The government’s response to the Australian Productivity Commission’s inquiry into executive pay
The Australian government released its response to the Productivity Commission’s (PC’s) inquiry into executive pay on Friday 16 April 2010.
While, as expected, it agreed with all but one recommendation, it added an additional action item for good measure.
The intent is to action all government legislative items for effect from 1 July 2011. The government will support or act on all recommendations except removing the tax on unvested equity at cessation of employment. Where their “support” is not sufficient for the ASX or ASX Governance Council to act, they will legislate to make it so.
Government responds to Australian Board of Taxation review of employee share schemes
On 23 April 2010, the Assistant Treasurer released the Board of Taxation’s review into technical aspects of the taxation of employee share scheme (ESS) arrangements, together with the government’s response.
The Board agreed with us that nothing can be done under the government's new tax framework to encourage startups.
Australian banker pay regulation receives thumbs up, but G20 emphasis may be misplaced
On 20 March the Financial Stability Board (FSB) released its progress report on the G20 countries’ implementation of sound compensation.
In this article we have highlighted the FSB recommendations that have relevance for APRA and APRA-regulated entities.
Remuneration Forum well received
Yesterday the annual Remuneration Forum for institutional investors, directors and management was well received, and saw some lively discussion and a surprising degree of consensus. Like last year, government representatives and regulators also attended. But alas, the politicians steered clear, as expected in an election year. A pity, as there was much constructive dialogue.
While the Chatham House Rule applied, we expect that we will be able to bring you a summary of the highlights for our next newsletter.
Latest GuerdonData® Updates
Updates to GuerdonData® include disclosures from the following 18 companies:
Adelaide Brighton Limited, Austar United Communications Limited, Australian Agricultural Company Limited, Boart Longyear Limited, Coca-Cola Amatil Limited, Iluka Resources Limited, Indophil Resources Nl, Intrepid Mines Limited, Invocare Limited, Macquarie Group Limited, Minara Resources Limited, Navitas Limited, News Corporation, OM Holdings Limited, Roc Oil Company Limited, Silver Lake Resources Limited , Spark Infrastructure Group, TPG Telecom Limited
Executive and director remuneration data from all ASX 300 companies on GuerdonData® is available to any subscriber. Visit our website for more information on GuerdonData®.
Assess how easily you can find out director and executive pay information by viewing our 6 minute demo. Click on the “More Info” button below.
Guerdon Associates in The News
“Exec pay reform slow but likely”, Patrick Durkin, Australian Financial Review, 6 April 2010, p. 7
“Advisers fees exposed”, John Kehoe, Australian Financial Review, April 17-18, 2010, p. 8
“Pay verdict a taxing point”, John Kehoe with Patrick Durkin and Annabel Hepworth, Australian Financial Review, April 19, 2010, p. 5