Pension fund savers value voting against directors

The survey found that the majority of savers believe that shareholder voting enables “strong” corporate governance.

Pension fund savers believe that voting against re-election of directors at shareholder meetings is an “effective way to express dissatisfaction with companies”.

The news comes after pension management company PensionBee surveyed 1,000 savers and found 61% were in favor of shareholder proposals as a way to hold boards accountable. .

According to Clare Reilly, PensionBee's chief engagement officer, the findings demonstrate “increasing demand” for strong corporate governance among pension members.

“With more than six in 10 respondents supporting voting against directors when a company's actions could pose a risk to the company's long-term profitability and performance, the message is It's clear: Shareholders are keen to drive accountability and use their influence to bring about change.'' It was also found that only 15% of savers are

The results were announced as the UK enters the early stages of shareholder meeting season. One of the issues looming over this year's annual meeting is an attempt by city officials to highlight the need for CEO pay increases to compete with other markets.

Julia Hoggett, chief executive of the London Stock Exchange, sparked a debate over pay last year when she posted a blog post calling for higher pay levels. she wrote: “We should encourage and support British businesses to compete for talent on a global scale, making the UK an attractive place for businesses to base, stay and grow. It will continue to be a great place.”

The idea has since been challenged by many observers, including city magnate Paul Drexler and Sandy Pepper, a payroll expert at the London School of Economics.

Recently, rumors have surfaced of an impending conflict over pay. Last week, proxy advisers Glass Lewis and ISS were set to receive a bonus share award worth around £15m to grocery delivery business Ocado, with CEO Tim Steiner set to receive a bonus share award worth around £15m. It was reported that they recommended voting against the new salary system. Ocado's general meeting of shareholders will be held on April 29th. Elsewhere, Smith & Nephew chairman Rupert Soames is on record as saying UK pay levels are “unsustainable”.

Another activist, the Capital Markets and Industry Taskforce (CMIT), led by Julia Hoggett, has called for further changes, calling it a “reset” of British corporate governance.

This includes removing the requirement that shareholder revolts (votes of 20% or more) be posted on the public register on the investment association website.

The register typically records important votes on issues such as individual directors and remuneration policies. CMIT claims that the 20% threshold is “arbitrary and distortive”. Sarah Wilson, one of Minerva's proxy voting advisors, called CMIT's proposal a “return to the lowest common denominator.”

So far this year's general meeting season, votes have been recorded for directors of Mitchells & Butler and this week for three directors of online trading platform Plus500.

Last year, the highest vote against a board member was 71.5%, who opposed the re-election of music investment fund Hipgnosis chairman Andrew Thatch.

There is an ongoing debate in the UK about the role and importance of governance. PensionBee's research is a reminder that this is not only a battle between boards, investors and policy makers, but also involves the interests of pension fund savers.