Shareholders vent anger as revolts at AGMS climb by 25pc
BUSINESS bosses are increasingly facing the wrath of angry shareholders as directors bore 237 revolts by investors in the first six months of 2018.
There are now 120 companies on the “public register” of firms that have faced a vote against directors by at least 20pc of investors.
This represents a 25pc jump in rebellions compared with the same period of 2017 and a 9pc rise in the number of companies facing unhappy shareholders, said the Investment Association, which tracks the votes.
Companies are showing a few signs of listening to investors on pay. Objections to remuneration resolutions fell on the year from 68 in 2017 to 61.
But dissatisfaction with specific directors climbed. At least 20pc of shareholders voted against re-elections in 66 cases. In five instances – all with directors at Petropavlovsk – the vote against was more than 50pc.
Andrew Ninian at the IA said rising rebellions against directors tends to be motivated either by concerns over that individual’s performance or by worries that they are on too many boards and so cannot devote enough time to oversee the business.
“What we are asking is that at the time of the company’s AGM they acknowledge they have had a high vote against them and they are going to do something about it. Some companies at that point say ‘we have heard from investors about the key issues’. But not every company says that,” he said.
“The second thing we are asking is that within six months the company puts out further statements to say what they have done since the vote, what have they heard from shareholders and what are they going to do as a result.”
Not all companies are listening. There were 29 repeat offenders across 35 resolutions who appeared on the register this year and in 2017 for exactly the same topic in each year. Of those, 14 are pay-related.