We’ve
now had a full year of AGMs where shareholders were given a non-binding
vote on a company’s remuneration report and only one company, Novogen,
has failed to crack majority support. Here are the top ten “against” votes as measured by the directed proxies:

Novogen: 72.5%
Oxiana: 46.9%

Sims Group: 35.6%
Investa Property Group: 35.14%

Valad Property Group: 29.8%
Spotless 24.2%
Jubilee Mines: 24.4%
Centennial Coal: 22%
Amcor: 21.38%
Rinker: 19.6%

Interestingly, the two highest paying companies, Macquarie Bank and
Babcock & Brown, both received strong support from shareholders,
suggesting that the scale of pay is not a problem, provided it is
performance-based and properly explained. The 96.58% for Babcock’s
remuneration report is partly explained by the fact that staff still
own 47% of the shares.

However, Macquarie Bank’s 95% directed proxy vote for its 32-page
remuneration report last week is even more impressive
because there have actually been 11 more unpopular board-endorsed
resolutions at the Millionaire Factory over the past five years as the
following table of directed proxy “for” votes shows:

The 13 most unpopular Macquarie Bank resolutions over the past five years:

2006: elect Stephen Mayne, 15.49%
2002: limit proportional takeovers, 74.72%
2004: re-elect David Clarke as executive chairman, 82%
2004: 82,800 options for David Clarke, 82.39%
2004: 165,000 options for Allan Moss, 82.52%
2004: 21,000 options for Mark Johnson, 82.53%
2004: 8,400 options for Laurie Cox, 82.54%
2005: 25,000 options for chairman David Clarke, 91.17%
2005: 5,620 options for Laurie Cox, 91.53%
2005: 180,000 options for Allan Moss, 91.55%
2005: 16,000 options for Mark Johnson, 91.57%
2001: introduce dividend reinvestment plan, 94.92%
2006: remuneration report, 95%

The remuneration report might have blown out the Macquarie Bank annual
report from 96 pages in 2005 to 116 pages in 2006 but shareholders have
given it a resounding thumbs up, so don’t expect the millionaires to
modify their bonus system any time soon.

Peter Fray

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