GuerdonNews® Volume 15 Number 2

March 2019

Dear reader,

 

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Welcome to the March 2019 issue of GuerdonNews®

 

 In this newsletter we:

• Confirm that there is one common variable correlated with votes against remuneration reports

• Review ASX Corporate Governance Principles and Recommendations changes

• Rank companies on the readability of remuneration reports

• Explore the link between CEO pay and innovation - we provide a checklist

• Note that we only have the remainder of this century to have equal representation of women in the top job

• Consider whether US oil company CEOs pay is a matter of luck or performance

• Summarise research suggesting more valid superannuation fund long term performance measures

• Note ASIC's focus post-Hayne

 

We conclude with executive and director remuneration disclosure updates available on the GuerdonData® on-line database.

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One variable correlates strongly with remuneration report votes

 Guerdon Associates runs the numbers on 7 years of ASX 300 votes 

The variable that correlates most strongly with remuneration report voting is not intrinsic financial performance. It is not long term TSR. 

It is short term TSR.

And the bigger the company the more likely it is to receive votes against its report.

Read more

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ASX Corporate Governance Principles

Significant changes from the previous edition

The fourth edition of ASX Corporate Governance Principles brings the principle “Act ethically and responsibly” to the forefront. Not surprising post-Hayne. But how best does a board do this? 

Read more

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ASX50 remuneration reports show significant improvement in readability

PhD optional?  

Our analysis shows that large companies concerted efforts to improve their remuneration reports can be easily understood have paid dividends.

Read more

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The influence of pay on company innovation 

Research indicates a link and between the the nature of executive pay and valuable ideas 

The research indicates interesting relationships between components of remuneration and innovation. 

Read more

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On current trends women will have an even chance of making it to the top job

Good news for your great great granddaughters, given that it will be by the end of this century

Fortunately, it will not be quite as long as for other jobs. 

Read more

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Executive pay in oil companies - luck or performance?

Rent-seekers need not apply

Executive remuneration of US oil company CEOs is found to be closely tied to movements in the oil price and some US CEOs have become adept at gaming the process of setting remuneration to their favour.

Read more

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Assessing superannuation funds' long term performance

Current metrics and incentives are short-sighted and gameable

A recent study presents five new “golden rules” to create more effective metrics.

Read more

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ASIC to go harder, looking at misbehaviour and pay

ASIC speaks about the final report of the Hayne Royal Commission

John Price makes note of the culture and governance problems and affirms ASIC’s renewed focus on more litigation regarding errant behaviour and poor corporate governance.

Read more

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Latest GuerdonData® Updates

Updates to GuerdonData®  this month include disclosures from the following 29 companies: 

Asaleo Care Limited, Appen Limited, Coca-Cola Amatil Limited, Costa Group Holdings Limited, Caltex Australia Limited, G8 Education Limited, Genworth Mortgage Insurance Australia Limited, Gpt Group, Galaxy Resources Limited, Ht&E Ltd, Iluka Resources Limited, IRESS Market Technology Limited, Invocare Limited, Janus Henderson, Ooh Media Limited, Oil Search Limited, OZ Minerals Limited, QBE Insurance Group Limited, Rio Tinto Limited, Scentre Group, Smartgroup Corporation Ltd, Spark Infrastructure Group, Santos Limited, Sydney Airport, Veda Advantage Limited, Viva Energy REIT, Woodside Petroleum Limited, WPP AUNZ Ltd, Yancoal Australia Ltd 

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 HERE.

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The information, analysis and opinion in this e-mail and attachments are intended to be for informational purposes only. Analyses are based on information taken from public documents or private surveys, and we do not represent to its accuracy. Guerdon Associates assumes no liability for the use or interpretation of information contained herein. This publication is provided 'as is' without warranty of any kind, either expressed or implied, including, but not limited to, the implied warranties of marketability, fitness for a particular purpose, or non-infringement of third party rights.

Copyright © 2019 Guerdon Associates

ISSN 1834-8300