Proxy voting is a key component of shareholder advocacy and an important responsible investing strategy. Every year, the Shareholder Association for Research and Education (SHARE) surveys the proxy voting practices of the country’s investment managers. The results of the ninth annual survey are generally positive and slightly better than last year, SHARE says, with one notable exception.
The study indicates that 71% of investment managers vote most of their pension fund clients’ proxies at their own discretion, without instructions or guidance. That’s up from 63% last year and reverses a downward trend in place since 2004.
“This suggests that more institutional investors, including pension funds, let their money manager decide how their proxies should be voted,” says Laura O’Neill, SHARE’s director of law and policy. “The lack of direction is cause for concern.”
“Pension funds, and other institutional investors, should give their proxy voting agents guidance on how their proxies should be voted, ideally by adopting a set of proxy-voting guidelines,” O’Neill adds. “This is important because pension fund trustees have a fiduciary duty to oversee how the proxies attached to their funds’ stocks are voted.”
On the positive side, the survey found that 40% of firms disclose their proxy voting guidelines to the public (an increase of 11% over 2008) and 49% consult with their clients about proxy voting guidelines (up from 39% in 2008). In addition, votes cast by participating firms were more likely to match SHARE’s votes than in 2008.
Thirty-five firms responded to the survey, a response rate of 56%, also an increase from previous years. SHARE says that indicates “greater fund manager willingness to be transparent and accountable about the exercise of proxy voting rights on behalf of clients.”
Download the full survey.
Showing posts with label SHARE. Show all posts
Showing posts with label SHARE. Show all posts
Tuesday, February 23, 2010
Friday, February 12, 2010
Say on pay gains ground in oil and gas sector
Meritas Mutual Funds, assisted by the Shareholder Association for Research and Education (SHARE), has withdrawn “say on pay” shareholder resolutions at Enbridge, EnCana and Suncor.
The three companies have agreed to establish an advisory vote on executive compensation, starting in 2011.
"Offering our shareholders a "say on pay" reflects Enbridge's commitment to shareholder engagement and to continuously improving our governance practices in view of emerging trends and best practices," said David Arledge, chair of the board of Enbridge Inc., in a statement.
EnCana’s board has approved a plan to include a non-binding advisory vote by shareholders on executive compensation at its annual general meeting planned for April 2011. “This vote will give EnCana shareholders an opportunity to provide feedback to the board of directors on the company’s approach to executive compensation,” the company said in a news release.
Suncor did not issue a formal public statement but a spokesman told the Calgary Herald that the company will announce a similar compensation plan next year.
Meritas filed say on pay resolutions at 12 companies last year. The Canadian Coalition for Good Governance expects as many as 35 public companies to sign up. The coalition published its say on pay policy last month.
The three companies have agreed to establish an advisory vote on executive compensation, starting in 2011.
"Offering our shareholders a "say on pay" reflects Enbridge's commitment to shareholder engagement and to continuously improving our governance practices in view of emerging trends and best practices," said David Arledge, chair of the board of Enbridge Inc., in a statement.
EnCana’s board has approved a plan to include a non-binding advisory vote by shareholders on executive compensation at its annual general meeting planned for April 2011. “This vote will give EnCana shareholders an opportunity to provide feedback to the board of directors on the company’s approach to executive compensation,” the company said in a news release.
Suncor did not issue a formal public statement but a spokesman told the Calgary Herald that the company will announce a similar compensation plan next year.
Meritas filed say on pay resolutions at 12 companies last year. The Canadian Coalition for Good Governance expects as many as 35 public companies to sign up. The coalition published its say on pay policy last month.
Thursday, September 17, 2009
Pushing Tim Hortons on Fair Trade
Canadian coffee drinkers love Tim Hortons. Many of us make multiple trips to the nearest "Timmy's" every day. But the coffee giant has so far resisted requests to offer Fair Trade certified coffee. A number of groups are working to change that.
According to the Shareholder Association for Research and Education (SHARE), the Fair Trade program offers an alternative to the conventional coffee trade, ensuring that producers in developing countries get a fair price for their products. "This is accomplished through a set of trading, social and environmental standards whose implementation by producers or buyers is certified by an independent body," SHARE says. The standards are established by Fairtrade Labelling Organizations International (FLO), a non-profit group based in Germany.
Although Fair Trade coffee is widely available in Canada, and has been for years, it's sold mostly in smaller, independent shops. Recently, SHARE and Batirente started a dialogue with Tim Hortons to request that the company start offering Fair Trade certified coffee. Ethical Funds has announced plans to engage Tim Hortons on the same issue this year.
Tim Hortons does have a Sustainable Coffee Program, a goodwill project that aims to provide financial assistance, technical training, education and social services to a number of coffee-producing communities in Guatemala, Colombia and Brazil. That's admirable and SHARE has asked for more information on the program.
But is it enough?
SHARE, working on behalf of Meritas Mutual Funds, says it hopes to convince Tim Hortons to adopt a more forward-looking approach to coffee sourcing. "The proposed steps recognize the significance of the Fair Trade coffee market growth and the opportunities that Fair Trade presents for Tim Hortons' coffee supply management processes," says SHARE.
Average annual sales of Fair Trade coffee grew nearly 33% in Canada between 2003 and 2008. Tim Hortons has a chance to share in that growth, while at the same time helping the estimated 25 million people around the world who depend on the coffee industry to make a living.
Something to think about next time you're waiting in that long line-up for a double-double.
According to the Shareholder Association for Research and Education (SHARE), the Fair Trade program offers an alternative to the conventional coffee trade, ensuring that producers in developing countries get a fair price for their products. "This is accomplished through a set of trading, social and environmental standards whose implementation by producers or buyers is certified by an independent body," SHARE says. The standards are established by Fairtrade Labelling Organizations International (FLO), a non-profit group based in Germany.
Although Fair Trade coffee is widely available in Canada, and has been for years, it's sold mostly in smaller, independent shops. Recently, SHARE and Batirente started a dialogue with Tim Hortons to request that the company start offering Fair Trade certified coffee. Ethical Funds has announced plans to engage Tim Hortons on the same issue this year.
Tim Hortons does have a Sustainable Coffee Program, a goodwill project that aims to provide financial assistance, technical training, education and social services to a number of coffee-producing communities in Guatemala, Colombia and Brazil. That's admirable and SHARE has asked for more information on the program.
But is it enough?
SHARE, working on behalf of Meritas Mutual Funds, says it hopes to convince Tim Hortons to adopt a more forward-looking approach to coffee sourcing. "The proposed steps recognize the significance of the Fair Trade coffee market growth and the opportunities that Fair Trade presents for Tim Hortons' coffee supply management processes," says SHARE.
Average annual sales of Fair Trade coffee grew nearly 33% in Canada between 2003 and 2008. Tim Hortons has a chance to share in that growth, while at the same time helping the estimated 25 million people around the world who depend on the coffee industry to make a living.
Something to think about next time you're waiting in that long line-up for a double-double.
Thursday, May 7, 2009
Amnesty, SHARE set sights on Chevron
As part of its annual Share Power campaign, Amnesty International is supporting a resolution urging Chevron to address investor concerns regarding its operations in Burma.
Chevron, in partnership with Total of France, the Petroleum Authority of Thailand and Myanmar Oil and Gas Enterprise (MOGE), holds equity in the largest investment project in Burma: the Yadana gas field and pipeline that transports gas to Thailand and has reportedly paid millions of dollars to the Burmese regime, Amnesty’s Ian Heide notes.
“Human rights organizations have documented egregious human rights abuses by Burmese troops employed to secure the pipeline area, including forcible relocation of villagers and use of forced labour on infrastructure related to the pipeline project.”
Chevron is the last major American company with active operations in Burma, according to the Shareholder Association for Research in Education (SHARE). “When Chevron purchased U.S. oil company UNOCAL in 2005, it acquired a minority stake in the Yadana pipeline,” SHARE says. A “grandfather” clause exempts Chevron from current U.S. sanctions on commercial activity in Burma.
Ongoing human rights issues, as well as mounting legal and reputational risks, have shareholders, unions and civil society groups calling for the company’s withdrawal from the country, SHARE adds.
The broad resolution – drafted by a diverse coalition of U.S. investors – calls on Chevron to submit a report by 2010 explaining the company’s criteria for investment in; continued operations in; and withdrawal from specific countries.
In its latest corporate social responsibility report, Chevron does not specifically mention its operations in Burma. “We are committed to respecting human rights in the countries and communities where we operate,” the report states.
SHARE says SRI investors can express support for human rights in Burma by asking mutual fund investment managers and advisors to consider voting in favour of the resolution.
Results will be announced at Chevron’s annual meeting on May 26, 2009.
Chevron, in partnership with Total of France, the Petroleum Authority of Thailand and Myanmar Oil and Gas Enterprise (MOGE), holds equity in the largest investment project in Burma: the Yadana gas field and pipeline that transports gas to Thailand and has reportedly paid millions of dollars to the Burmese regime, Amnesty’s Ian Heide notes.
“Human rights organizations have documented egregious human rights abuses by Burmese troops employed to secure the pipeline area, including forcible relocation of villagers and use of forced labour on infrastructure related to the pipeline project.”
Chevron is the last major American company with active operations in Burma, according to the Shareholder Association for Research in Education (SHARE). “When Chevron purchased U.S. oil company UNOCAL in 2005, it acquired a minority stake in the Yadana pipeline,” SHARE says. A “grandfather” clause exempts Chevron from current U.S. sanctions on commercial activity in Burma.
Ongoing human rights issues, as well as mounting legal and reputational risks, have shareholders, unions and civil society groups calling for the company’s withdrawal from the country, SHARE adds.
The broad resolution – drafted by a diverse coalition of U.S. investors – calls on Chevron to submit a report by 2010 explaining the company’s criteria for investment in; continued operations in; and withdrawal from specific countries.
In its latest corporate social responsibility report, Chevron does not specifically mention its operations in Burma. “We are committed to respecting human rights in the countries and communities where we operate,” the report states.
SHARE says SRI investors can express support for human rights in Burma by asking mutual fund investment managers and advisors to consider voting in favour of the resolution.
Results will be announced at Chevron’s annual meeting on May 26, 2009.
Tuesday, March 24, 2009
Tenth company adopts “say on pay”
Potash Corporation of Saskatchewan has announced it will voluntarily introduce a non-binding shareholder advisory vote on executive compensation starting next year.
“Potash is the last of the companies slated to face Meritas Mutual Funds’ proposal for a “say on pay” vote during the 2009 proxy season,” the Shareholder Association for Research and Education (SHARE) said on its website. “All of the companies that received the Meritas proposal implemented it in response to the filing.”
The ball started rolling in late February, when votes at RBC and CIBC received majority shareholder support. Bank of Montreal and Scotiabank shareholders followed suit the next week, as did Laurentian bank, but since then, support has been voluntarily, with TD Bank, National Bank, TMX Group, Sun Life and Potash all agreeing to adopt the resolution without a shareholder vote. Only Nortel Networks, which is facing an uncertain future and has postponed its annual meeting, has not followed suit.
For social investors concerned about corporate governance, adoption of the resolution at ten of Canada's largest companies is a clear victory, but Gary Hawton, chief executive officer at Meritas, says there's more work to be done.
“There are still many more companies we had approached but chose not to file – we can only manage so many AGMs in a year – and we are going to go back to them asking them to voluntarily adopt the vote in 2010,” Hawton says. “After we have reached a larger number of adopters, I think it will be incumbent on the Canadian Securities Administrators to then mandate the advisory vote to maintain a level playing field.”
“Potash is the last of the companies slated to face Meritas Mutual Funds’ proposal for a “say on pay” vote during the 2009 proxy season,” the Shareholder Association for Research and Education (SHARE) said on its website. “All of the companies that received the Meritas proposal implemented it in response to the filing.”
The ball started rolling in late February, when votes at RBC and CIBC received majority shareholder support. Bank of Montreal and Scotiabank shareholders followed suit the next week, as did Laurentian bank, but since then, support has been voluntarily, with TD Bank, National Bank, TMX Group, Sun Life and Potash all agreeing to adopt the resolution without a shareholder vote. Only Nortel Networks, which is facing an uncertain future and has postponed its annual meeting, has not followed suit.
For social investors concerned about corporate governance, adoption of the resolution at ten of Canada's largest companies is a clear victory, but Gary Hawton, chief executive officer at Meritas, says there's more work to be done.
“There are still many more companies we had approached but chose not to file – we can only manage so many AGMs in a year – and we are going to go back to them asking them to voluntarily adopt the vote in 2010,” Hawton says. “After we have reached a larger number of adopters, I think it will be incumbent on the Canadian Securities Administrators to then mandate the advisory vote to maintain a level playing field.”
Wednesday, March 18, 2009
TD Bank gets on “say on pay” bandwagon
TD Bank agreed Wednesday to allow its shareholders an advisory vote on executive compensation, starting next year.
The votes, which are non-binding, have already been accepted by the rest of Canada’s big banks, including RBC, CIBC, Scotiabank and BMO.
The resolution, brought forward by Meritas Mutual Funds and Mouvement d'éducation et de défense des actionnaires (MEDAC) was to be voted on at TD’s annual meeting on April 2, however in a pre-emptive move, the bank decided to accept the proposal and the resolution will now be withdrawn.
"TD promotes open and proactive dialogue with shareholders, ensuring their feedback on compensation and other important issues is heard and carefully considered by the board," TD chairman John Thompson said in a release Wednesday.
"It's now clear from the votes held this year at the other major Canadian banks' meetings that the opinion of the investment community, while still divided, has moved in favour of an advisory vote, and so we've acted accordingly."
Last week, TMX Group, parent of the Toronto Stock Exchange, and Sun Life Financial both said they will voluntarily offer shareholders a non-binding advisory vote on executive pay starting at their annual meeting next year. As a result, Meritas withdrew its proposal at both companies.
Just a few weeks ago, Canadian banks were carefully counting proxy votes before making the decision to adopt a non-binding pay vote, the Shareholder Association for Research and Education (SHARE, which assisted Meritas on the resolutions) noted on its website. “Now, companies are implementing a shareholder 'say on pay' well ahead of their shareholder meetings.”
Laura O’Neill, director of law and policy at SHARE, says she’s pleased with TD’s decision, but adds that “given the lockstep in which our big banks move on governance, we certainly didn’t think that TD had much choice. But we’re happy to see the announcement a full two weeks before their AGM.”
O’Neill notes that Sun Life and TMX’s acceptances of the resolution are perhaps even more significant, providing a toehold into the world of issuers who are not banks, “because that’s clearly where we want to go.”
There are still a couple of outstanding executive compensation resolutions: Potash Corporation meets May 7 and a proposal was also filed at Nortel Networks, which filed for protection from creditors in January. “I doubt very much we’ll ever see this proposal on a Nortel ballot,” O’Neill concedes.
Considering the momentum the executive compensation has generated during this proxy voting season, O’Neill says she’s very interested to see what will happen next. “We’d like to see movement by the Canadian Securities Administrators to put this in place across the board. It would be a quick, clean way to get this done.”
The votes, which are non-binding, have already been accepted by the rest of Canada’s big banks, including RBC, CIBC, Scotiabank and BMO.
The resolution, brought forward by Meritas Mutual Funds and Mouvement d'éducation et de défense des actionnaires (MEDAC) was to be voted on at TD’s annual meeting on April 2, however in a pre-emptive move, the bank decided to accept the proposal and the resolution will now be withdrawn.
"TD promotes open and proactive dialogue with shareholders, ensuring their feedback on compensation and other important issues is heard and carefully considered by the board," TD chairman John Thompson said in a release Wednesday.
"It's now clear from the votes held this year at the other major Canadian banks' meetings that the opinion of the investment community, while still divided, has moved in favour of an advisory vote, and so we've acted accordingly."
Last week, TMX Group, parent of the Toronto Stock Exchange, and Sun Life Financial both said they will voluntarily offer shareholders a non-binding advisory vote on executive pay starting at their annual meeting next year. As a result, Meritas withdrew its proposal at both companies.
Just a few weeks ago, Canadian banks were carefully counting proxy votes before making the decision to adopt a non-binding pay vote, the Shareholder Association for Research and Education (SHARE, which assisted Meritas on the resolutions) noted on its website. “Now, companies are implementing a shareholder 'say on pay' well ahead of their shareholder meetings.”
Laura O’Neill, director of law and policy at SHARE, says she’s pleased with TD’s decision, but adds that “given the lockstep in which our big banks move on governance, we certainly didn’t think that TD had much choice. But we’re happy to see the announcement a full two weeks before their AGM.”
O’Neill notes that Sun Life and TMX’s acceptances of the resolution are perhaps even more significant, providing a toehold into the world of issuers who are not banks, “because that’s clearly where we want to go.”
There are still a couple of outstanding executive compensation resolutions: Potash Corporation meets May 7 and a proposal was also filed at Nortel Networks, which filed for protection from creditors in January. “I doubt very much we’ll ever see this proposal on a Nortel ballot,” O’Neill concedes.
Considering the momentum the executive compensation has generated during this proxy voting season, O’Neill says she’s very interested to see what will happen next. “We’d like to see movement by the Canadian Securities Administrators to put this in place across the board. It would be a quick, clean way to get this done.”
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