GuerdonNews® Volume 15 Number 10

November 2019

Dear reader,

 

Welcome to the November 2019 issue of GuerdonNews®

 

 In this newsletter we:

• Suggest that ACSI's effective 20% voting power on ASX 300 AGM resolutions could ensure boards take note of their new corporate governance guidelines

• Contend that APRA only require boards to submit evidence that remuneration works as intended, as it has the power to remove directors if evidence of competence is insufficient

• Note the APRA chairman's intolerance for remuneration regulation criticism, given the absence of constructive alternatives

• Wonder why option fair value calculations fail to incorporate employee behaviour

• Provide insights into global investor governance and voting 

 

We conclude with executive and director remuneration disclosure updates available on the GuerdonData® on-line database. And if you have any other executive remuneration or governance query type it into your search engine with "Guerdon Associates" and you will find we will likely have provided an answer already.

New ACSI Governance Guidelines 

Take note, as ACSI may steer up to 20% of your AGM votes  

Guerdon Associates highlights the key elements of the new 2019 guidelines, including annual director elections, binding votes on company pay policy, board gender diversity and CEO pay ratio disclosure. The guidelines encourage directors to pay greater attention to ESG factors.

Read more

APRA can already counter the effects of the 2-strikes rule that promotes "bad" tick the box executive pay

So why prescribe remuneration when they can remove directors who do not prove they are competent on remuneration matters? 

The submissions to APRA's draft CPS 511 remuneration regulation disclosed to-date do not address what APRA wants to achieve. Guerdon Associates suggests putting the onus on regulated entities to prove the effectiveness of their remuneration framework will ultimately lead to what APRA wants to achieve – a thriving financial services sector. 

Read more

APRA chairman suggests companies stop whining on remuneration regulation    

Unless more constructive suggestions for regulation are made 

There is no shortage of (critical) feedback from all stakeholders. Missing, according to Chairman Wayne Byres, is an alternative to APRA’s prescriptive draft regulation. 

Read more

Deferred shares ditch problematic 3-year performance measures  

Many in the UK recognise that long cycle, commodity price driven, capital intensive industries are not amenable to traditional LTI plans

However, others think that, while longer term deferred shares may provide clarity and simplicity, there is a danger that these plans would attract executives keen to avoid making tough decisions. Proxy advisors do not agree among themselves on the merits of deferred shares.

Read more

Exercising options

Is your company over-expensing?

Valuing options more validly can help your company’s bottom line. We summarise research that reinforces this.

Read more

Seven lessons from engaged investors

Global trends in corporate governance impact votes across all ASX 300 companies

Global investors own 50% of the ASX 300. What are they thinking? Guerdon Associates' global GECN Group presents its 2019 research from engagement with investors from 20 countries regarding executive remuneration, board structure and composition, and shareholder rights. 

Read more

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Latest GuerdonData® Updates

Updates to GuerdonData®  this month include disclosures from the following 8 companies: 

Amcor Limited, Australia And New Zealand Banking Group Limited, Australian Pharmaceutical Industries Limited, Bank Of Queensland Limited, Premier Investments Limited, Soul Pattinson (W.H) , TPG Telecom Limited, Westpac Banking Corporation 

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