Another company at the big end of town that will come under the shareholder microscope will be ANZ. It won’t hold its meeting until December, but a series of scandals will place intense pressure on its chief executive, Shayne Elliott, and chairman Paul O’Sullivan.
Corporate and prudential regulators have heightened concerns about ANZ’s governance, stemming from the bonds trading scandal, in which traders are alleged to have manipulated the bond rate, forcing up the federal government’s cost during a $14 billion debt sale last year.
That issue has exposed a host of cultural and governance problems at the bank that will receive plenty of scrutiny from major shareholders and their proxy advisors. Following the financial services royal commission, all banks received a significant shareholder backlash and the ANZ board will be bracing for impact.
The annual meetings at our two major supermarkets – Woolworths and Coles – should also provide some entertainment. While Woolworths has already been forced to weigh its complicity in making a marine species extinct, both it and Coles have been stung by an Australian Competition and Consumer Commission action alleging that they misled customers on pricing.
Given almost all of their retail shareholders are also customers, with many likely to have been whipped into a frenzy by the price gouging claims, there is likely to be plenty of drama from the floor.
The 12 per cent decline in Woolworths’ share price this year will probably add extra spice to the proceedings.
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Another notable board likely to cop some brickbats from shareholders will be that of the sharemarket operator ASX, following legal claims from the Australian Securities and Investments Commission (ASIC) that it misled the public about the progress of a troubled software upgrade
Meanwhile, two of our major media companies, Nine Entertainment – the owner of this masthead – and Seven West Media, will undoubtedly field questions on workplace cultural issues that have dominated the headlines this year.
While there are a number of high-profile companies under the glare of regulators, shareholders and the community, the proxy advisors keep an eye on governance and remuneration thematics and make recommendations to large shareholders.
Institutional Shareholder Services’ Vas Kolesnikoff, who advises large investors on how to vote on executive pay packets and put difficult questions to a board, said early signs point to shareholders persisting with concerns about executive bonuses and the use of opaque and readily achievable non-financial performance measures to justify them.
While investors continue to be well served by the major companies, this year’s annual meeting season should be a handy barometer of how much social license they are willing to give to companies in the limelight for all the wrong reasons.
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