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News and Commentary

The newsletter providing company-specific commentary, and news of market and regulatory developments.
Bonus clawbacks - not just a banking question
18th March 2014 | The Bank of England announces strengthening of bonus claw backs A key feature of the pay debate since the global financial crisis has been bonuses purporting to be based on profits, when asset valuations were later shown to be unreliable, and large financial penalties for miss selling and misconduct arrive some years after the event.
Collective Engagement Working Group issues first report
3rd Dec | The Working Group has recommended a new Investor Forum be established and operational by June 2014.
Overseas investors take over UK
Non-British shareholders own more than half of the UK-quoted shares, raising questions about the current regime of company ownership.
HKEx won’t kowtow to Alibaba
Alibaba’s anticipated $15bn IPO on the Hong Kong Stock Exchange seems unlikely because the company and regulators can not agree on the governance structure.
The rise of benefit corporations
The benefit corporation phenomena is causing legislative changes but it remains unclear to what extent it can impact corporate governance in the mainstream market.
Questioning shareholder primacy
One of the interesting ideas in the Parliamentary Commission on Banking Standards report was that shareholder primacy should be removed at the banks.
LAPFF outlines Moore v Bompas on IFRS
17th Dec 2013 | LAPFF is maintaining its pressure on regulators and UK banks over the accounting treatment of impairment and some IFRS standards.
BEPS and Sustainable Business
25th Feb 2014 | What goes around.....institutional investors can't sit this fight out forever
Bankers, Bonuses & Blunt Instruments
14th Jan 2014 | Bankers trying to dodge measures to restrict their bonus payments should take a long hard look at themselves
Sir Win Bischoff named FRC Chairman
28th Jan 2014 | Appointment Highlights Need for Reform
Placing a Value on Carbon Risk
28th Jan 2014 | Internal carbon pricing becomes part of business planning
LAPFF acts on Diversity
25th Feb 2014 | FTSE laggards may face AGM votes as Forum backs LGIM
PRI not so academic
4th Feb 2014 | New reading on Governance
IFRS slides on reporting standards
11th Feb 2014 | The International Financial Reporting Standards Foundation (IFRS) whose core function is based on setting "high quality, understandable, enforceable and globally accepted" financial reporting rules has been filing inaccurate and late returns at Companies House the Daily Telegraph reports
FCA goes long on forex fraud
11th Feb 2014 | Banks face billions in new fines? UK Financial Conduct Authority (FCA) chief Martin Wheatley has confirmed the breadth of the current investigations into the alleged benchmark rigging by banks in answers to questions from the House of Commons Treasury Committee at a recent hearing.
Bankers' bonuses twice tax payments
18th Feb 2014 | The gift that keeps on giving. The UK financial sector has paid out twice as much in bonuses since the financial crash than it has paid in corporation tax, new analysis by the Trade Union Congress (TUC) reveals.
US Companies Face More Pressure on Disclosure
25th Feb 2014 | Political Donations Come Under Scrutiny. 48 large US companies will face common shareholder resolutions in the 2014 proxy season calling for annual disclosure of political spending and donations to trade associations and lobby groups.
Proxy firms settle on Code of Conduct
11th March 2014 | Transparency, disclosure and governance principles apply to the watchers to as well as the watched.
Shareholders up for extra billions as forex probe grows
11th March 2014 | New day, new scandal, new round of fines and impairment costs set to be borne by institutional investors. Institutional investors may be facing a new round of multi billion dollar losses to fines and impairment costs arising out the current Forex probes into a host of global banks.
Shareholders want new Fox chair
Two out of three minority shareholders have backed a resolution seeking the appointment of an independent chair at 21st Century Fox.
Best Practice Principles for Governance Research Providers
Paris; London; Frankfurt – 28 October 2013 — the charter signatories (see below) of the Best Practice Principles for Governance Research Providers announced today a public consultation with regard to their draft Principles in relation to activities associated with the provision of shareholder voting and analytical services.
More tape trouble for Murdoch
News Corp insiders believe that the final cost of the phone-hacking scandal could hit £1bn.
Pension charges and transparency
The government brought forward reforms that will reduce the charges on pension schemes used for auto-enrolment and increase transparency in the pension sector so that employers find it easier to compare schemes.
The end of ownership secrecy
Last week at the Open Government Partnership summit the Prime Minister David Cameron announced that details of who really owns and controls UK companies will be made publicly accessible.
Oracle: an American plutocracy?
For the second year running, American IT giant Oracle has lost the advisory vote on its executive pay policy. Yet members of the board remain intransigent, and shareholder patience is running out.
BIS response on stewardship
UK shareholders should not be forced to join collective engagement groups decided BIS.
Acting in concert
The European Commission report on the Directive 2004/25/EC on Takeover Bids (TBD), called for clarification of the concept of “acting in concert” to dispel uncertainty around the possibility of shareholders co-operating with each other being forced to make a mandatory bid.
RSA – “All my bags are packed I'm ready to go”
RSA Insurance has revealed a capital hole in its Irish insurance subsidiary. RSA has commissioned an enquiry into RSA Ireland which was audited by Deloitte.
PIRC news
Was HM Treasury in a time warp of the Big 4’s making?
In early 2011 PIRC began to state publicly that the accounting model UK banks were following was hiding substantial losses. Interestingly the FSA had mooted this in a speech from Lord Turner in early 2010, but then seems to have gone silent.
EasyJet’s ups and downs
Everyone likes a winner. Easyjet is a recent entrant to the FTSE 100 and its share price has trebled in the last 18 months.
Shareholders revolt at Kier Group
Shareholders of the Kier Group PLC, a construction, services and property company, expressed their dissatisfaction with the group’s management at the recent AGM.
Corporate tax avoidance tops public concern
3rd Dec 2013 | Tax Avoidance is now No1 on the league table of public concerns at business behaviour and the general slide in confidence since 2010 has continued
PRI Takes New Step on Long Term Investing
10th Dec 2013 | The Principles for Responsible Investment is considering a long term investment mandate trial involving pooled capital from a group of signatories
Norwegian SWF goes long on risk
4th March 2014 | Review of carbon based investments shows leadership in investment and engagement
EU reaches agreement on improved disclosure
4th March 2014 | CSR takes a step forward with improved transparency around non-financial information set to pass in April.
Working with activists pays off
Research finds that boards that compromise with activist investors perform better than those which do not.
Enhancing auditor accuracy
Research suggests a way around auditor’s conflict of interest by way of linking auditing fees to the accuracy of their reporting.
CC back 10-year audit tenders
Men over-Board?
18th March 2014 | Nestle generous in sharing their talent. Much of the attention around the Minder Initiative, the new Swiss corporation laws that came into effect in January 2014 and phase in through to 2015, have rightly been placed on director and executive pay arrangements.
City of London AGM pay defeat
City of London Investment Group (CLIG) saw serious investor opposition at its AGM last week, with a heavy defeat for its remuneration policy.
Humpty Dumpty accountants
“When I use a word,” Humpty Dumpty said, in rather a scornful tone, “it means just what I choose it to mean—neither more nor less.”
Change to Win challenge Oracle
Change to Win Investment Group, the investment arm of one of the US trade union centres, is calling for an overhaul of executive pay practices at IT giant Oracle.
Media companies face challenge
The next few weeks will see a series of interlocked events take place which look likely to have significance for investors in listed UK media companies.
Samsung’s leadership succession
Investors are getting nervous about the transition of power at the South Korean conglomerate.
Climate Bonds Initiative looks to low carbon transport
14th Jan 2014 | Institutional focus on the green and climate bond market ramps up in 2014 as global investor interest grows
It’s A Fine Thing as FCA Harvests Bumper 2013 Crop
8th Jan 2014 | The UK financial regulator levied a record £472m in fines for 2013, up 51% on the previous 2012 record amount.
FRC Moves on Banking Audit Standards
17th Dec 2013 | Investor campaigns for improvements bear fruit as regulator signals ‘step change’
UK Pension Funds Back US Bus Drivers
18th March 2014 | Joint AGM resolution to address labour rights issues at National Express. A group of UK based local authority pension funds are co-sponsoring a resolution drawn up by the US-based International Brotherhood of Teamsters calling for policy changes at a US based subsidiary of National Express, the FTSE250 international transport conglomerate.
If the cap fits...
25th March 2014 | As reported in previous PIRC Alerts the new European cap on bonuses has caused banks to search for new and creative pay structures as a means of avoiding the cap.
2014 Budget: Pensions liberation or disaster?
25th March 2014 | Difficult choices ahead on pensions, argues our guest contributor Bryn Davies, Union Pension Services
Are our CEOs worth it?
25th March 2014 | Regulators should force companies to look at pay in context, argues our guest contributor Deborah Hargreaves, Director High Pay Center
Let’s stay together?
1st April 2014 | Although the referendum on Scottish independence is now only six months away few companies have joined the public debate.
Governing the ungovernable: how employees can help
1st April 2014 | By our guest contributor Deborah Hargreaves When your chief executive resigns, branding the group as “ungovernable,” days after his huge pay deal has been leaked to the press, it is clear you face a challenge at the top of your organisation.
Bonuses make performance worse
Academics burst the balloon on oversized bonuses and performance
National Express AGM Faces Another Bumpy Ride
Trans Atlantic Campaign Urges Board to Change Track on US Subsidiary Labour Issues
Sword of Damocles – Sheathed!
Government U-Turn on Local Government Pension Scheme mergers- Comment by Alan MacDougall PIRC 13th May 2014
Long-Term Incentive Plans: neither long-term nor incentive?
25 April 2014 | Problems with performance pay by Guest Contributor Deborah Hargreaves, Director of the High Pay Centre
Party leaders ignore inequality at their peril in run-up to election
29th April 2014 | Barclays AGM reflects the anger ordinary people feel over pay at the top
Blowing in the wind
13th May 2014 | Questions arise over tax status. Wind Farms. Noisy, ugly and subsidised to meet a green agenda or clean and efficient providers of cheap and sustainable energy?
US case may see limits on class actions by investors
20th May 2014 | Halliburton seeks to overturn shareholder ability to act collectively on securities fraud
PIRC Annual Corporate Governance Conference
Shareholder Engagement: Influencing Change Friday 13th June, Central London
Economic Inequalities: Shaping Capital for the 21st Century
27th May 2014 | Piketty asks some serious questions and the financial sector is yet to respond with serious answers.
King Wants Banking Reform
27th May 2014 | Former BoE Governor muses on parallels with the 1930s while warning that systemic risks remain.
Lagarde Lashes Reform Laggards
27th May 2014 | IMF Chief delivers some blunt messages on the need for global reforms in London conference address
The Value of Responsible Investment
3rd June 2014 | Cambridge group seeks investment action to avoid systemic risks and build sustained value. The Investment Leaders Group (ILG), a three-year project supported by the University of Cambridge, has issued a new report titled "The Value of Responsible Investment."
London Stock Exchange joins Sustainable Stock Exchange Initiative
3rd June 2014 | LSE Group adds weight to global initiative pushing for improved ESG disclosure and standards amongst publicly listed companies.
UK Banks to start the longest journey?
3rd June 2014 | Formation of new banking standards council inches closer
Is the Grass Always Greener?
10th June 2014 | Weatherford makes another move, all in search of stability...
AP2 reports increase in number of women on boards
10th June 2014 | Survey by Sweden's second national pension fund shows improvements in gender diversity
Local Authority Funds Make an Impact
17th June 2014 | Investing4Growth initiative mask start of collection impact investment in UK regions
The Chancellor George Osborne and the integrity of Financial Markets
17th June 2014 | Are reverse incentives needed to improve corporate behaviours and bring bankers to heel?
The Governance challenge for Japan
24th June 2014 | Corporate reform a key factor for future growth
PRI Powers On
24th June 2014 | Global ESG body adds signatories and substance
Companies losing out when it comes to raising capital
24th June 2014 | ACSI study argues Australian companies are paying too much for underwriting services
Law Commission Reports on Fiduciary Duty
1st July 2014 | Report clarifies relevance of ESG factors in trustee decision making
New Accounting body proposed in Hong Kong
1st July 2014 | Hong Kong Government launches consultation auditor on reforms
ACSI Pushes on Sustainability Risks
8th July 2014 | Australia’s top 200 companies subject to scrutiny and new regulations
Supreme Court Heads off Halliburton Security Fraud Redress
8th July 2014 | Win for shareholders as existing precedent upheld by Court, but door now slightly ajar
Chevron Chews on Labour Rights
15th July 2014 | International union campaign seeks shareholder support
Sunshine on BEPS Downunder
15th July 2014 | Australian examples of world’s worst practice on tax dodging exposed
Walgreens Tries Inversion
22nd July 2014 | SEC complaint filed over submerged briefing
The Name’s Bond, Green Bond.
22nd July 2014 | Market set to grow as ESG investing comes to the fore but standards need solidification
White House gets going on Agriculture and Climate Risks
29th July 2014 | PRI dives into water resourcing to help keep investors afloat in a sea of uncertainty
No Butts or Bombs Says Croydon
29th July 2014 | Local Authority Fund Drops Tobacco, Arms and Nuclear Power from Investments
Resources rhetoric up a notch
5th August | Australian economy under threat, but local commentators and business point the wrong way...again.
Business, Human Rights and Supply Chains
5th August | AGM Spotlight on Ralph Lauren is a matter of good governance by investors.
US Proxy Season Shows some Promise
12th August 2014 | Remuneration, board reforms, ESG issues reflect investors priorities and pressures.
Norwegian Fund Intent on Transparency
12th August 2014 | Giant SWF will announce votes in advance of meetings for selected companies.
Columbia steps up on Sustainability
20th August 2014 | Second Latin American exchange to join SSE Initiative, bigger indexes are still slow to move.
Zombie directors-still warming board seats
20th August 2014 | Voting reform needed to fix major US weakness in Board accountability
Tyco Goes off Piste
2nd September 2014 | Serial domicile switcher seeks to avoid shareholder accountability
Injection of Good Governance Needed at Allergen
10th Sept | Skin in the game does not always stretch to a vote.
Tax Reform Focus as G20 Approaches
10th Sept | Transparency and disclosure around global tax and financial secrecy appears on investor radar
The Trillion Dollar Scandal
16th Sept 2014 | UK floats stronger penalties for business corruption but banking & corporate secrecy hinders following the money.
OECD outlines next steps in BEPS Battle
16th Sept 2014 | Finance Ministers to consider new rules ahead of G20 November Brisbane Summit
Going Dutch on remuneration
23rd September | Pension fund releases guidelines for executive remuneration
Australia Reins in Exec Pay
23rd September 2014 | Legislation with teeth puts the bite on excessive payments and builds shareholder engagement
More muddle at the FRC with ‘true and fair’
30th September 2014 | Faulty vision creates flaws in accounting standards
Investors & Climate Risk
7th October 2014 | New York and Montreal Announcements signal an investor shift in the run up to Paris 2015
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