GuerdonNews® Volume 16 Number 5

June 2020

Dear reader,

 

Welcome to the June 2020 issue of GuerdonNews®

 

 In this 15th year anniversary newsletter we: 

 

• Describe realisable pay versus TSR as a key proxy adviser and investor "board competence"  test 

• Investigate the relationship between COVID-19 pay reductions and loss in market value

• Raise a key risk with executive option grants

• Try, once again, to improve share scheme taxation with our parliamentary enquiry submission

• Consider the impact of capital raisings on executive remuneration

• Examine G20 Financial Stability Board workshop outcomes on banker compensation

• Summarise results of our snap COVID-19 survey

 

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.

Remuneration committee competence being tested by an easy diagnostic 

Now being actively used by a proxy adviser 

Realisable or realised pay (depending on the proxy adviser) is becoming a more important measure to check if pay is aligned with performance. But most remuneration committees are not benchmarking it, which seems peculiar, given it provides a quick snapshot of committee competence.

Read more

Do COVID-19 remuneration adjustments relate to change in market value? 

If not, it would indicate some boards may not be as concerned with their shareholders' wellbeing as others.

We investigate the effect of a reduction in market value on whether a company is more likely to have reduced KMP remuneration as a result of COVID-19. Is the response across boards to COVID 19 impacts consistent?

Read more

Options: win-win until they put executives in hock

Trading windows and option exercises combine for risky business

What's not to love about options? Executives win. Shareholders win. And.... Money lenders win. We explain this little understood risk in option grants.   

Read more

Guerdon Associates' has another go to fix share scheme taxation

Australian Parliament asks if ESS taxation fits the bill. 

We suggest changes that would make it easier for companies to source and keep talent, improve business sustainability, encourage Australian economic growth with a more diverse talent and investment pool, and for no net cost to government revenues. What's not to like?

Read more

The best type of capital raising for employee shareholders

Answer has to do with equity on foot. 

Going forward we would expect to see raisings that are structured to better consider the interests of all shareholders and employees with unvested equity.

Read more

FSB Workshop: globally, banks doing the right thing, but challenges remain

Improving governance has its downsides

We examine key takeaways from a G20 Financial Stability Board compensation policy workshop.

Read more

COVID-19 quick survey results

STIs still undecided. LTIs are more firm.

We summarise the results to last month's 2-minute survey on COVID-19 changes to remuneration. 

Read more

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Latest GuerdonData® Updates

Updates to GuerdonData®  this month include disclosures from the following 10 companies: 

Australian Agricultural Company Ltd, ALS Ltd, Ausnet Services Ltd, CSR Ltd, Investec Aust Property Fund, James Hardie Industries PLC, Jupiter Mines Ltd, Macquarie Group Ltd, OFX Group Ltd, Xero 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