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AGM Report Card from ASIC: "Significantly less tumultuous"

Rory Maguire

On 29 January 2018, ASIC published its overview of the 2017 annual general meeting (AGM) season, concluding that the latest AGM season was “significantly less tumultuous” than previous years.


Each year, ASIC monitors the AGMs of the ASX 200 companies in order to detect key emerging trends and corporate governance issues, and to monitor the extent to which AGMs are used to facilitate shareholder engagement.  Good corporate governance and board/management accountability are key concerns of ASIC, who see AGMs as playing an important role in “providing a forum for shareholders to critically assess a company’s business strategies and future prospects” and “hold(ing) the board and company management accountable for a company’s performance”.

2017 AGM Report Highlights

A copy of ASIC’s report on the 2017 AGM season can be accessed here. Some of the key findings of the report were:

Executive remuneration

  • Shareholders delivered fewer ‘strikes’ on director remuneration reports (being a protest vote by shareholders of 25% or more).  The 6 companies receiving ‘strikes’ were Myer, Karoon Gas, Reliance Worldwide, iSentia, Mortgage Choice and Mineral Resources.
  • Despite fewer ‘strikes’, there was an increase in the number of ‘close calls’ (attracting a protest vote of between 20% and 25%).  Companies in the ‘close call’ category included Harvey Norman, Brambles, Goodman Group and Healthscope.
  • ASIC encouraging simplicity in the design and disclosure of board/management incentive structures in order to assist shareholder understanding.

Director elections

  • A strong sense of shareholder input and engagement was evident, with resolutions for the election of directors attracting clear increases in the number of material ‘against’ votes (attracting vote of greater than 10%).  Large protest votes were recorded against directors at Harvey Norman, Brambles, Karoon Gas and CBA.
  • Shareholders in the current market appear more willing to vote against an individual director, rather than the remuneration report itself, in order to express their concerns around performance.

Proxy advisers

  • Proxy advisers continued to actively scrutinise governance practices and issued a number of ‘against’ recommendations on shareholder resolutions (13% of all resolutions received a proxy advisor ‘against’ recommendation, which resulted in an average 17% ‘against’ vote on these resolutions).
  • The voting outcomes of resolutions receiving an ‘against’ recommendation may be attributable to matters other than proxy advisers’ recommendations, such as company performance.

Diversity and ESG

  • Gender diversity on the boards of ASX-listed companies continues to be a topic of interest among shareholders.  ASIC continues to advocate for board diversity (including gender diversity) in order to achieve optimal board performance.
  • Shareholders also advocated for action on specific environmental, social and governance issues.

Effectiveness of AGMs

  • ASIC continued to highlight its concerns with the fact that some companies (25 in the ASX 200) still allow resolutions to be decided by a show of hands rather than by conducting a poll (which goes against the principle of ‘one share one vote’).
  • Encouragement by ASIC for companies to seek out ways to increase shareholder engagement, including through the use of technology (eg. ‘hybrid’ AGMs which allow shareholders to attend, vote or ask questions physically or online).

Further information

Please contact Rory Maguire or Rohan Harris from our Corporate and Commercial team should you require further information or advice in relation to shareholder meetings or other corporate governance matters.

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