Vol 10 Issue 7
- Date:18 Apr 2012
- Type:Boardroom Report
Executive pay law flaws heighten AGM worries
Delays in fixing a flaw in executive pay legislation could disenfranchise numerous retail investors and boost the chances of the "two strikes" regime being invoked for several companies in the upcoming annual general meeting (AGM) season.
According to Guerdon Associates, the "two strikes" law has some drafting errors that mean regular shareholders (ie. those who are not key management personnel or close associates) who lodge undirected proxies with the chairman of an AGM will not have their remuneration report votes counted.
The Council of Australian Governments (COAG) Reform Council was concerned that planned reforms of director liability laws would not be delivered on time and to a reasonable standard, the council's chairman Paul McClintock said at a recent Australian Institute of Company Directors lunch in Sydney.
After extensive consultation with the not-for-profit (NFP) sector, the Government has decided to extend the start date for the 2011-12 Budget measure to better target NFP tax concessions from 1 July 2011 to 1 July 2012.
Directors should take care in limiting the damage tough decisions made in tough times can do to their organisations' employment brand.
An initiative aimed at improving the level of Australian directors' understanding of financial reporting requirements needs your help.
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