The 2012/05/10 at 07:50
Stéphanie Salti, in London
In Great Britain, it is known as the “Shareholder Spring”, in reference to the “Arab Spring” of 2011. For this is another revolt, all in good form, this time targeting the heads of the major British groups, traditionally elusive about the question of bonuses. While the announcement on the remuneration of Bob Diamond, Chief Executive of Barclays, made no waves in March when the annual report was published, the same did not apply when the British bank held its general assembly at the end of April.
One-quarter of the bank’s shareholders voted against the bank’s policy on the payment of its executives. Barclay’s announcement that Bob Diamond would renounce one-half of his 2.7 million-pound bonus for his 2011 performance a few days ago failed to calm things down completely. Ditto for excuses from the Chairman of Barclays, sorry about providing incorrect information on the payment of his Chief Executive. The story was repeated on 3 May, on the occasion of the general assembly of shareholders of the British insurance group Aviva. The Chairman of the Remuneration Committee, Scott Wheway, expressed the company’s regret at not engaging more closely with shareholder views on this point.
A few days previously, Aviva’s Chief Executive had even announced that he would renounce a salary rise of 4.8 % from April onwards, bringing his salary up to 1.2 million euros. The shareholders’ response was unambiguous: 54 % rejected the remuneration report. Their reason: Andrew Moss’s vague strategy ever since he arrived at the helm of the insurance group in 2007, and an inexorable decline in share prices, down by around 58 % in the last five years. He finally announced his resignation on 9 May.
These are not isolated cases. Over the same period, four other British companies have endured rebellions from shareholders, including IMI, Avocet Mining, as well as a company specialised in promotional products, 4imprint. Nor is this rebellion contained within British borders only: 31% of Crédit Suisse shareholders voted against the executive remuneration report, while the British fund manager Hermes wishes shareholders to vote to withhold exoneration of the supervisory board of Deutsche Bank for the 2011 financial year at the bank’s general assembly on 31 May. The reason behind this is that the German bank apparently failed to give its shareholders the possibility of voting on its remuneration report last year… In Great Britain, Vince Cable, Business Secretary, has invited shareholders to continue their revolts and to take control of their businesses afresh. Indeed, the Business Secretary wishes that in the future, shareholder votes on executive pay become restrictive, and not merely consultative as is currently the case.