Shareholder Democracy

Insurance companies and Kentz

With the attack by the Government on annuities in the budget and the revelation that the FCA is to look into the treatment of some policyholders such as those in "closed" funds, both investors in these companies and their directors must be somewhat incensed. Indeed the Financial Times reported this morning that half a dozen of the City's top institutional investors have consulted a leading law firm over alleged "market abuse" in the way the latter review was disclosed. It seems ...

Shareholder Activism wins at Leaf Clean Energy

Leaf Clean Energy (LEAF) is an investment trust that specialises in "renewable energy and sustainable technology". It raised $386 million in 2007 but subsequently bought back some of its shares giving an effective net figure of $307m. At June 2013, net assets were reported as $183m, i.e. substantial losses have been made, and the latest interim figures announced yesterday (26/3/2014) reported another $1.8m of losses. A more extensive analysis of the issues at the company was given in the last ShareSoc ...

Remuneration Policies and Baronsmead VCT 3

The new Enterprise Regulatory Reform Act requires public companies to take a vote on Remuneration Policy, i.e. a forwarded looking binding vote for the next three years, as opposed to the non-binding retrospective one on the Remuneration Report with which we are all familiar. The latter will still be present, and investors might worry that the former will be a long-winded and tedious document that they will need to plough through (rather like the multi-page Remuneration Reports from large companies). There have ...

Barclays – Who benefits?

Barclays Bank announced their final results yesterday. The results did not match expectations and the shares fell 4% on the day. The national media led with the story that the company had still increased the bonus pool even so, and that the company now pays out more in bonuses than it pays in dividends to shareholders. The CEO, Antony Jenkins,  gave the usual excuse for the high pay levels - that they need to compete on the international scene for top class ...

Nominee system defeats shareholder voting

ShareSoc  has recently issued a survey to our Members and the public covering their voting and attendance at General Meetings and the prevalence of the use of nominee accounts. The results demonstrate that the nominee account system undermines shareholders' ability to vote at the General Meetings of the companies they own.Nominee accounts are now the commonest form in which investors hold shares in companies (89% of ShareSoc Members held some shares in a nominee account, as opposed to the use of ...

Eurofinuse adopts manifesto

Eurofinuse, a representative body for European shareholder organisations of which ShareSoc is a Member, has adopted a "Better Finance Manifesto". They are launching this before the European Parliament elections in May to try and influence politicians to adopt policies to protect savers and investors over the coming years.Although some of the manifesto policies are focussed on problems in other countries in Europe than the UK, there are many meritorious aspects. Here's just a few of the issues they cover:1. That there ...

Hargreaves Lansdown doubles charges for some investors

On the 15th January Hargreaves Lansdown (HL) announced new charges on its investment platform, which is one of the most widely used by private investors. The changes are no doubt provoked by the new rules whereby funds can no longer pass part of their charges back to HL, as a result of the RDR (Retail Distribution Review). But the changes will mean that the annual fees paid to HL by some investors will double. ShareSoc has issued a press release explaining ...

Survey on voting and nominee accounts

ShareSoc is working on a campaign regarding shareholder rights for private shareholders and it is important for us to obtain the evidence on whether you vote the shares you hold at General Meetings, whether you attend such meetings and whether you receive information from the companies in which you invest. We have therefore sent a survey to all of our members asking them to respond. It is also possible for non-members to complete the survey using the link below (please also ...

Collective Engagement – a new “City Club” for institutions?

The Kay Review advocated the setting up of a mechanism whereby institutional investors could engage better with public companies. This was seen as a way to improve understanding between investors and companies, to encourage more long-term thinking, to enable debate on strategic options and to tackle such problems as excessive pay.A first step has been the setting up of a "Collective Engagement Working Group" under the Chairmanship of James Anderson of Baillie Gifford. It has produced a report on how such ...

RBS, Hibu and the unacceptable face of banking

There have been extensive media comments lately on the activities of the Royal Bank of Scotland in lending to smaller businesses, and what they did when those businesses got into financial difficulties. The articles printed focussed on two reports on the activities of RBS - a report commissioned by the bank by Sir Andrew Large, and one by Lawrence Tomlinson* who acts as a consultant to the BIS Department. Both reports, but particularly the latter one, were quite damning about the ...

Pan African Resources AGM Report – a minor victory for shareholders on buy-backs

Pan African Resources is a South African gold mining company, but they are registered in the UK and hence hold their AGMs in London. This year it was at 10.00 am on the 22nd November in the City of London despite shareholders complaining about the 10.00 am start time last year. A full report is here, but here are some of the noteworthy points. Only the Chairman Keith Spencer was present from the directors, and he said the main reason for absence ...

Great news – real company owners to be disclosed

The Prime Minister has announced that the details of who really owns and controls UK companies will be made publicly accessible. More details will be announced in early 2014,, but the key paragraph in the announcement from the BIS Department includes the statement that the Government will “………potentially use as a model the disclosure regime that currently applies in relation to disclosure of information on company shareholders. This would mean that companies would hold information on the names and addresses of ...