Meritas Mutual Funds, assisted by the Shareholder Association for Research and Education (SHARE), has withdrawn “say on pay” shareholder resolutions at Enbridge, EnCana and Suncor.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.
Showing posts with label executive compensation. Show all posts
Showing posts with label executive compensation. Show all posts
Friday, February 12, 2010
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on April 2, however in a pre-emptive move, the bank decided to accept the proposal and the resolution will now be withdrawn.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.”
Wednesday, March 4, 2009
Two more banks agree to allow shareholders “say on pay”
Following the lead of RBC and CIBC, the Bank of Nova Scotia and the Bank of Montreal have agreed to implement a shareholder resolution on executive compensation.
The resolution — which allows shareholders to provide an annual advisory vote to the banks’ boards of directors on executive compensation — received 51.6% support at Scotiabank and 53.6% at BMO at annual general meetings held on Tuesday.
The two banks indicated they would respect the vote and work with shareholders to implement the resolution. "I’d like to announce that the bank will provide shareholders with a non-binding vote on executive compensation at the next shareholders meeting," said BMO chair David Galloway.
The resolution was filed with all of Canada’s big banks by Meritas Mutual Funds with support from SHARE (Shareholder Association for Research and Education). At RBC and CIBC’s annual meetings, the ‘say on pay’ proposals garnered the support of 54.4% and 51.9% of shareholders, respectively. TD Bank, whose AGM is scheduled for next month, is also expected to support the resolution.
Meritas brought the issue of advisory votes on executive compensation to the Canadian investment community in 2007 through dialogue with Canada's largest banks and followed up with shareholder proposals asking for a vote. "We asked that this vote be advisory, so that it would not ultimately determine executive pay, but would provide clear and consistent shareholder feedback on the decisions that bank boards make about compensation", said Meritas CEO Gary Hawton.
Last year, support at the big banks averaged 40.5%. Hawton says he was surprised by the increased level of support this year, adding that he is hopeful regulators will consider rules requiring companies to hold votes on executive compensation.
The resolution — which allows shareholders to provide an annual advisory vote to the banks’ boards of directors on executive compensation — received 51.6% support at Scotiabank and 53.6% at BMO at annual general meetings held on Tuesday.
The two banks indicated they would respect the vote and work with shareholders to implement the resolution. "I’d like to announce that the bank will provide shareholders with a non-binding vote on executive compensation at the next shareholders meeting," said BMO chair David Galloway.
The resolution was filed with all of Canada’s big banks by Meritas Mutual Funds with support from SHARE (Shareholder Association for Research and Education). At RBC and CIBC’s annual meetings, the ‘say on pay’ proposals garnered the support of 54.4% and 51.9% of shareholders, respectively. TD Bank, whose AGM is scheduled for next month, is also expected to support the resolution.
Meritas brought the issue of advisory votes on executive compensation to the Canadian investment community in 2007 through dialogue with Canada's largest banks and followed up with shareholder proposals asking for a vote. "We asked that this vote be advisory, so that it would not ultimately determine executive pay, but would provide clear and consistent shareholder feedback on the decisions that bank boards make about compensation", said Meritas CEO Gary Hawton.
Last year, support at the big banks averaged 40.5%. Hawton says he was surprised by the increased level of support this year, adding that he is hopeful regulators will consider rules requiring companies to hold votes on executive compensation.
Thursday, February 26, 2009
Banks agree to shareholder proposals on executive compensation
In a major victory for the "say on pay" campaign, two of Canada's big banks have agreed to implement a shareholder resolution on executive compensation.
At its annual general meeting today, RBC shareholders voted 54.4% in favour of a resolution filed by Meritas Mutual Funds and 56.9% in favour of a similar resolution filed by Medac (Le Mouvement d'education et de defense des actionnaires).
CIBC has not yet released detailed numbers, but the same resolution at its AGM also received majority support.
The resolution - filed at all of Canada's big banks - allows shareholders to provide an annual advisory vote to the banks' boards of directors on executive compensation. The votes are non-binding - boards will still retain ultimate jurisdiction on compensation - but advocates say today's move gives shareholders a voice on a critical corporate governance issue.
"Now we have two of Canada's big banks respecting the wishes of the majority of their shareholders by allowing them to provide the board of directors with feedback on executive compensation," said Meritas president Gary Hawton in an interview shortly after the results were announced. "Our view is that if the directors do not hear from the shareholders they represent on executive pay, they will not be able to take these views into account in their decisions."
Hawton says he's optimistic that today's votes will set a precedent: similar resolutions have been filed at the Bank of Montreal and Bank of Nova Scotia, whose AGMs are scheduled for next week. Hawton hopes BMO and BNS will follow the lead of RBC and CIBC and if that happens, TD Bank could simply scrap its vote and agree to the proposal, since its AGM won't be held until April 2.
National Bank made just such a pre-emptive move today, announcing before its AGM that shareholders would be given an advisory vote on executive compensation starting next year. "In so doing, the bank is acknowledging the developments of the past few weeks relating to this matter and fulfilling a wish expressed by many of its shareholders," National said in a statement.
This could mean a clean sweep for the resolution at the banks, a major achievement considering the same resolution received an average of 40.5% support last year. Similar resolutions have been filed this year by Meritas with Sun Life Financial, the TMX Group, Nortel Networks and Potash Corporation.
"We're hopeful that today's results will lead to other corporations accepting this model," Hawton added, noting that the issue could ultimately end up in the hands of the regulators.
At its annual general meeting today, RBC shareholders voted 54.4% in favour of a resolution filed by Meritas Mutual Funds and 56.9% in favour of a similar resolution filed by Medac (Le Mouvement d'education et de defense des actionnaires).
CIBC has not yet released detailed numbers, but the same resolution at its AGM also received majority support.
The resolution - filed at all of Canada's big banks - allows shareholders to provide an annual advisory vote to the banks' boards of directors on executive compensation. The votes are non-binding - boards will still retain ultimate jurisdiction on compensation - but advocates say today's move gives shareholders a voice on a critical corporate governance issue.
"Now we have two of Canada's big banks respecting the wishes of the majority of their shareholders by allowing them to provide the board of directors with feedback on executive compensation," said Meritas president Gary Hawton in an interview shortly after the results were announced. "Our view is that if the directors do not hear from the shareholders they represent on executive pay, they will not be able to take these views into account in their decisions."
Hawton says he's optimistic that today's votes will set a precedent: similar resolutions have been filed at the Bank of Montreal and Bank of Nova Scotia, whose AGMs are scheduled for next week. Hawton hopes BMO and BNS will follow the lead of RBC and CIBC and if that happens, TD Bank could simply scrap its vote and agree to the proposal, since its AGM won't be held until April 2.
National Bank made just such a pre-emptive move today, announcing before its AGM that shareholders would be given an advisory vote on executive compensation starting next year. "In so doing, the bank is acknowledging the developments of the past few weeks relating to this matter and fulfilling a wish expressed by many of its shareholders," National said in a statement.
This could mean a clean sweep for the resolution at the banks, a major achievement considering the same resolution received an average of 40.5% support last year. Similar resolutions have been filed this year by Meritas with Sun Life Financial, the TMX Group, Nortel Networks and Potash Corporation.
"We're hopeful that today's results will lead to other corporations accepting this model," Hawton added, noting that the issue could ultimately end up in the hands of the regulators.
Thursday, February 12, 2009
Ethical Funds maps out action plan for 2009
It looks to be another busy year for the research team at Vancouver-based Ethical Funds, with today’s release of the mutual fund company’s extensive sustainable investment program annual report.
Bob Walker, vice president, sustainability, says Ethical plans to focus on three key issues in 2009. “The first is investor risk in Canada’s oil sands. The second is how companies can assess the full range of their impacts on human rights and ensure that their activities benefit impacted communities. The third will address how investors can help restore integrity to capital markets and the publicly-traded companies that benefit from the ethical functioning of those markets.”
As well as engaging oil sands companies on climate change, Ethical will ask companies in other sectors to work on emissions reduction, including continued dialogue with real estate companies on implementing green building strategies. Oil sands companies will also be asked to address cumulative water use issues and forestry companies will be encouraged to adopt sustainable practices.
On the social side, Ethical will continue to work with companies to encourage the development and implementation of human rights policies and programs when operating in risky countries. The fund company will also work towards eliminating sweatshop conditions and make an effort to ensure companies are not inadvertently supporting the use of child or forced labour.
Respecting indigenous rights is also on the 2009 agenda, particularly in the mining sector, where Ethical will support the adoption of informed consent as the standard for project development.
Corporate governance will be Ethical’s third main focus, with the company asking companies to improve their corporate social responsibility reporting and overall quality of their disclosure. Curbing excessive compensation will remain a priority, with Ethical asking that compensation be linked to positive performance on both the financial and the non-financial side.
“We believe companies that proactively address environmental, social and governance challenges have a long-term competitive advantage over companies that choose to ignore these issues,” notes Walker.
The sustainability report also includes highlights from Ethical’s work in 2008, including encouraging more Canadian companies to participate in the Carbon Disclosure Project, encouraging Canadian banks to adopt and disclose procedures for evaluating climate change-related credit risk in their commercial lending policies and raising awareness of the risks investors face from the scale and pace of development in Alberta’s oil sands.
Bob Walker, vice president, sustainability, says Ethical plans to focus on three key issues in 2009. “The first is investor risk in Canada’s oil sands. The second is how companies can assess the full range of their impacts on human rights and ensure that their activities benefit impacted communities. The third will address how investors can help restore integrity to capital markets and the publicly-traded companies that benefit from the ethical functioning of those markets.”
As well as engaging oil sands companies on climate change, Ethical will ask companies in other sectors to work on emissions reduction, including continued dialogue with real estate companies on implementing green building strategies. Oil sands companies will also be asked to address cumulative water use issues and forestry companies will be encouraged to adopt sustainable practices.
On the social side, Ethical will continue to work with companies to encourage the development and implementation of human rights policies and programs when operating in risky countries. The fund company will also work towards eliminating sweatshop conditions and make an effort to ensure companies are not inadvertently supporting the use of child or forced labour.
Respecting indigenous rights is also on the 2009 agenda, particularly in the mining sector, where Ethical will support the adoption of informed consent as the standard for project development.
Corporate governance will be Ethical’s third main focus, with the company asking companies to improve their corporate social responsibility reporting and overall quality of their disclosure. Curbing excessive compensation will remain a priority, with Ethical asking that compensation be linked to positive performance on both the financial and the non-financial side.
“We believe companies that proactively address environmental, social and governance challenges have a long-term competitive advantage over companies that choose to ignore these issues,” notes Walker.
The sustainability report also includes highlights from Ethical’s work in 2008, including encouraging more Canadian companies to participate in the Carbon Disclosure Project, encouraging Canadian banks to adopt and disclose procedures for evaluating climate change-related credit risk in their commercial lending policies and raising awareness of the risks investors face from the scale and pace of development in Alberta’s oil sands.
Friday, February 6, 2009
Say on pay campaign gains momentum
Canada’s big banks will be under the microscope at their upcoming annual meetings, once again facing shareholder proposals on executive compensation.
Meritas Mutual Funds, with assistance from SHARE (Shareholder Association for Research and Education), has filed shareholder resolutions at all five of Canada’s big banks asking for shareholders to be able to provide to the boards of directors an advisory vote on executive compensation. Similar proposals have been filed with Sun Life Financial, the TMX Group, Nortel Networks and Potash Corporation.
“You can’t pick up any newspaper’s business section without there being some kind of commentary on executive compensation,” Meritas CEO Gary Hawton said in an interview with SRI Monitor. “And I think it’s important that we establish a dialogue with boards of directors.”
“They do report to us as shareholders and it’s a hot topic right now.” Hawton adds. “There’s a perception that pay and performance have not been linked in the past; sometimes you get paid for success and you also get paid for failure.”
The votes are non-binding – boards will still retain jurisdiction on compensation. “We’re just looking to be able to provide them with feedback that they can take or leave,” Hawton stresses.
Last year, Meritas sponsored similar resolutions at the big banks, which averaged 40.5% support. But because this is a shareholder proposal, there is no magic number. “Even if we get 100%, the board could still ignore it,” Hawton notes.
Hawton says he’s optimistic the resolution will receive more support this year. “There are a number of institutional investors who said last year it was too early, but got nowhere in their discussions with management, so they are now on board with this proposal. So that could push us over the 50% mark. And what do the boards of directors do when the majority of shareholders are asking for this?”
By next year’s proxy voting season, Hawton believes there will be some Canadian companies on board with the resolution, but adds he’s disappointed it hasn’t happened yet. “It’s already happening in the U.K. and a number of U.S. companies have voluntarily said we will provide this opportunity. It’s recognized around the world as a sign of good governance.”
“Everyone is afraid to be the first mover on this,” he says. “We need someone to understand this is an opportunity to be applauded for being a governance leader in this area.”
Meritas Mutual Funds, with assistance from SHARE (Shareholder Association for Research and Education), has filed shareholder resolutions at all five of Canada’s big banks asking for shareholders to be able to provide to the boards of directors an advisory vote on executive compensation. Similar proposals have been filed with Sun Life Financial, the TMX Group, Nortel Networks and Potash Corporation.
“You can’t pick up any newspaper’s business section without there being some kind of commentary on executive compensation,” Meritas CEO Gary Hawton said in an interview with SRI Monitor. “And I think it’s important that we establish a dialogue with boards of directors.”
“They do report to us as shareholders and it’s a hot topic right now.” Hawton adds. “There’s a perception that pay and performance have not been linked in the past; sometimes you get paid for success and you also get paid for failure.”
The votes are non-binding – boards will still retain jurisdiction on compensation. “We’re just looking to be able to provide them with feedback that they can take or leave,” Hawton stresses.
Last year, Meritas sponsored similar resolutions at the big banks, which averaged 40.5% support. But because this is a shareholder proposal, there is no magic number. “Even if we get 100%, the board could still ignore it,” Hawton notes.
Hawton says he’s optimistic the resolution will receive more support this year. “There are a number of institutional investors who said last year it was too early, but got nowhere in their discussions with management, so they are now on board with this proposal. So that could push us over the 50% mark. And what do the boards of directors do when the majority of shareholders are asking for this?”
By next year’s proxy voting season, Hawton believes there will be some Canadian companies on board with the resolution, but adds he’s disappointed it hasn’t happened yet. “It’s already happening in the U.K. and a number of U.S. companies have voluntarily said we will provide this opportunity. It’s recognized around the world as a sign of good governance.”
“Everyone is afraid to be the first mover on this,” he says. “We need someone to understand this is an opportunity to be applauded for being a governance leader in this area.”
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