PIRC : independent research and advisory consultancy

PIRC is the UKs' leading independent research and advisory consultancy providing services to institutional investors on corporate governance and corporate social responsibility. Since 1986, it has been the pioneer and champion of good corporate governance within the UK.
Authoritative resource
PIRC has a wide spectrum of clients ranging from pension funds, faith-based investors, trade unions to banks and asset managers. Its Corporate Governance Service is an authoritative and vital resource for active investors, whilst its widely-read Shareholder Voting Guidelines provide a market-wide benchmark for investors and forms part of the movement for corporate governance reform and long-term wealth creation strategies for responsible investors.

For more information about PIRC or to arrange a meeting, contact Janice Hayward, or call us on 0207 247 2323.

H&R Block

US financial services company H&R Block has been through a governance overhaul recently. No doubt in no small part due to the presence of ex-SEC chair and activist investor Richard Breeden on the board, following his election at last year’s AGM, the company has pushed through a string of welcome changes.

The positions of Chairman and CEO have been split since the previous year’s annual meeting, with Mr. Breeden serving as Chairman since November 19, 2007. Additionally, the company has adopted a process of annual elections for director nominees and PIRC regards declassification of the board as a positive advance in the company's corporate governance. The Board has also allowed the Company’s “shareholder rights plan,” or poison pill, to expire on March 25, 2008.

Since Breeden was also a monitor for KPMG LLP, the company's auditor, the company determined that this would interfere with the auditor's independence. Therefore, the board has taken the decision to appoint new auditors. The Audit committee announced the appointment of Deloitte & Touche as the company's auditors for the 2008 fiscal year.

Another significant development is the company’s decision to put its executive compensation policies and procedures to an advisory shareholder vote, making it only the second S&P 500 company to do so.

PIRC commends H&R Block for its decision to voluntarily seek shareholder ratification of its executive compensation policy and practices. The PIRC compensation rating model on "say on pay" proposals has three parts, relating to management proposed advisory votes on companies’ overall pay programs. The first section on disclosure is rated as a B; the second on the balance of incentive and rewards is rated as a D; and the third on director contracts is rated as a C.

The overall rating of BDC leads us to recommend an abstain vote upon this resolution as the balance of incentives and rewards is considered to require further disclosure of performance metrics.

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