www.proxyinsight.com

November 2019Volume 6, Issue 10

VOTING NEWS

PROXY MONTHLY

TURNING THE PAGE: AN OVERVIEW OF GREECE’S LARGEST EVER CORPORATE GOVERNANCE EVENT

STRENGTHENING GOVERNANCE: AN INTERVIEW WITH FLORENT DEIXONNE, HEAD OF THE SUSTAINABLE AND RESPONSIBLE INVESTMENTS TEAM AT LYXOR

It may be off-season for annual meetings in the US, but the past month has not been a

quiet one. The news has been dominated by the SEC’s latest basket of proposed reforms. If implemented, these will tighten the regulator’s grip on proxy advisers and make the requirements for resubmitting a shareholder proposal more stringent.

Both sides of these reforms have proved controversial, with the proxy adviser regulation sparking a particular backlash. ISS is going so far as to sue the SEC, though this lawsuit relates largely to earlier guidance updates.

The Council of Institutional Investors (CII), meanwhile, has sent a request under the Freedom of Information Act for the data the SEC used to generate stats on errors in proxy adviser reports. The CII said it was “not entirely certain… whether the SEC staff considered the merits of issuer claims… and whether the staff checked claims against reports from the relevant proxy advisory firms.”

Perhaps the most sensational development was when an investigation by Bloomberg revealed that over 30 letters to the SEC from “ordinary

Americans” supporting proxy adviser reform, some of which were specifically cited by SEC chair Jay Clayton, were tied to a corporate lobby group. Some of the people whose names were on the letters neglected to mention that they were closely related to the 60 Plus Association’s leader. Others denied any knowledge of the letters they had supposedly penned.

Speaking of proxy advisers, both ISS and Glass Lewis have unveiled the updates to a number of their regional policies for 2020. There were no earth-shattering changes this year, but the two advisers made tweaks on a number of hot-button issues such as executive pay, board diversity and auditors.

While the US is enjoying a busy off-season, it is peak period for AGMs in Australia. It is therefore no surprise that there has been plenty of activity down under. Banks ANZ and Westpac made changes to their executive pay in a bid to head off revolts, while banking regulator APRA is considering a number of controversial reforms to link executive bonuses in the sector more closely to non-financial factors.

Meanwhile, there were revolts against the remuneration reports

of Myer and Lendlease, but in both cases opposition fell short of the 25% threshold required to trigger a “strike.” Ramsay Health Care was not so lucky, receiving a third strike after roughly 29% of shareholders opposed the report.

For our main article this month, we have a write-up of Turning the Page, a corporate governance event held last month in Athens. The event, a joint initiative of Velos Advisory and EY Greece, was the largest of its kind ever held in Greece, with 140 attendees including directors and chairs, investor relations professionals, corporate secretaries and more.

Our interview is with Florent Deixonne, Head of the Sustainable and Responsible Investments Team at Lyxor. Florent discusses progress, change and reform in the world of corporate governance, and details some of the issues he thinks could benefit from more attention.

Proxy Insight is the only tool to offer the voting intelligence necessary to navigate today’s investor relations market. If you are not a client and would like to take a look, we would be delighted to offer you a trial. Please get in touch.

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Proxy StatementNick Dawson, Co-Founder & Managing Director, Proxy Insight Limited.

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Turning the PageAn overview of Greece’s largest ever corporate governance event

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Panel - Taking Greek Corporate Governance to the Next Level

ModeratorAlan Millings, Global Capital Markets Leader, EY

PanellistsManuel Isaza, Vice President, Investment Stewardship for EMEA, BlackRockThibaut Barsacq, Vice President of Proxy Research, Institutional Shareholder Services (ISS)Francesco Drigo, Head of Proxy Voting, Investment Stewardship, GeneraliDr. Martin Czurda, CEO of the Hellenic Financial Stability FundDr. Leda Condoyanni, Corporate Governance Director & Company Secretary, Mytilineos

The panellists discussed the ways in which stronger corporate governance would prove vital in attracting foreign capital. The panel agreed that, in the long term, quality of governance is usually tied to quality of performance and investors are conscious of this when deciding where to put their money. They also emphasised the importance of constructive engagement and the role that independent board members play in the business’ relationship with investors.

Foreign investors noted that Greek companies are currently quite inward-looking. They would like to see issuers take steps towards more disclosure and engage in an open and active dialogue with their investors. They added that, for engagements to be constructive, they would like corporates to come to them before decisions have been finalised, so as to have the opportunity for constructive dialogue.

Introduction

As Greece is just emerging from a turbulent decade of economic difficulties, has experienced a change in government, and recently became the first country to implement parts of the EU’s new Shareholder Rights Directive (SRD II), an interesting event took place in Athens in early October. A joint initiative of Velos Advisory and EY Greece, the event was titled: Turning the Page: Taking Greek corporate governance to the next level. The event aimed to contribute to the public debate around corporate governance and raise awareness at company, state and regulatory levels. It also hoped to raise the profile of Greek companies internationally by providing first-hand views, and offer practical solutions from international experts on how Greek issuers can enhance their engagement and reporting practices.

Held at the Hilton Hotel in Athens, on October 2nd, this was the largest corporate governance event ever to take place in the country, featuring domestic and international speakers. It was attended by more than 140 Chairs, NEDs, and C-suite executives, as well as IROs, corporate secretaries, General Counsels and Audit teams.

Akis Skertsos, Deputy Minister for the coordination of government work and formerly Director General of the Hellenic Federation of Enterprises, delivered the opening speech. He described how governance would be central to “restoring the country, breaking away from the vicious cycle of backwardness and underdevelopment,” also stating that the current government is “determined to lay the groundwork for Greece to shine again.”

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“THE TIME WHERE DIALOGUE WITH INVESTORS WAS AN EXERCISE THAT WAS CARRIED OUT AT THE TIME OF THE

AGM HAS PASSED” -AEMILIA VARFIS, CEO, VELOS ADVISORY

Making Greece Attractive for Investment

SpeakersVassilis Kaminaris, Head of Assurance Services, EY GreeceAemilia Varfis, CEO, Velos Advisory

Vassilis Kaminaris spoke about EY’s recent study, Attractiveness Survey: Greece 2019, which looked at how much appeal the country holds for global investors. He said that there is a lot of interest in Greece, but also spoke about “necessary reforms in areas such as taxation, reinforcement of education and human skills, support for the innovation and technology industries, and the growth of SMEs.”

“However”, Kaminaris added, “it is understood that corporate governance will play a key role in enhancing the confidence of foreign investors.”

Aemilia Varfis then talked about a complimentary study commissioned by Velos Advisory, called Making Greece Attractive For Investment - Institutional Perception Of Greece. The survey, carried out by UK-based firm Investor Update, was commissioned specifically for the event and captured the flipside, namely investors’ perception of the Greek market across several areas. Investors were assured that comments would not be attributed to the individual, and could also opt to keep their institution anonymous. With this layer of anonymity, they provided “full and frank” views, Varfis said.

The respondents were cautiously positive across the board. While Greece has had a tough few years, they generally felt it was now through the worst, and, in some cases, Greece is the best performing market in their investment universe. Most respondents rated the country as “hold,” with the remainder rating it as “buy.” However, they were conscious of the fact that the country is still in recovery, with one investor saying that there is only a limited number of investable companies at this stage. Respondents also revealed that Greek investments currently make up less than 5% of their investment portfolio.

On the subject of financial communications, there was a consensus that, despite some improvement overall, further enhancements are still needed in areas such as IR, reporting and ESG. Improvement in these fields would give a real boost to investor confidence.

Prepare for an Effective Engagement

In the first in a series of presentations on Requirements for Greek Issuers for 2020, Aemilia Varfis explained how external investors and rating agencies rate Greek companies, and proposed several ways in which companies can prepare for more effective engagement with their investors.

One of the key takeaways was that companies should not wait until their AGMs are imminent before they engage with investors. “The time when dialogue with investors was an exercise that was carried out at the time of the AGM has passed,” she said. “There is now a need for dialogue with investors throughout the year.”

Varfis quoted a similar point from BlackRock CEO Larry Fink’s latest letter to CEOs, which said, “for engagements to be productive, they cannot occur only during proxy season when the discussion is about an up-or-down vote on proxy proposals.”

Similarly, F. William McNabb III, CEO and chair of Vanguard, said in a letter of his own in 2017: “Engagement is a process not an event, whose value only grows over time. A CEO we engaged with once said ‘You can’t wait to build a relationship until you need it’ and that could not be more true.”

Varfis also pointed out that international investors would like to see Greek companies improve in several areas, such as board composition, including gender diversity, diversity of skills, and management oversight. They would also like to see an improvement in audit quality and would welcome the introduction of a Senior Independent Director role on Greek boards.

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Remuneration Reporting

With Greece being the first country to implement the remuneration requirements of the SRD II, Kris Amiralis, Strategic Partner in People Advisory Services at EY Greece, talked about remuneration reporting. Amiralis detailed the new standards the EU Directive and Greek law will demand of issuers, with the forward-looking remuneration policy beginning this year and the backward-looking remuneration report starting from 2020.

He discussed the structure of these disclosures, describing the different reports which are needed and the kind of information they should contain. He then talked about some of the different remuneration mechanisms that investors like to see throughout Europe, both for executive and non-executive directors.

Finally, the importance of a robust dialogue with investors arose once again. “Now that you have a structure for reporting, the key is to engage with your investors, before finalizing it,” Amiralis concluded.

Related Party Transactions Approval

Next up, Sofia Kalomenides, Partner at EY Greece and EY Capital Markets Leader for Central, Eastern, Southeastern Europe and Central Asia (CESA), spoke on another area impacted by SRD II: related party transactions. The new EU standards require more stringent procedures for the approval of these transactions, and a lot more disclosure of the information surrounding them.

Kalomenides discussed how to identify transactions that fall within the scope of the new rules; who is and is not a related party, and what kinds of transactions are exempt. She then suggested some practical steps companies could take to ensure compliance with the new rules, such as maintaining a complete list of their related parties and ensuring that all transactions receive the support of independent directors.

Is Cybersecurity About More Than Protection?

Lastly, Panagiotis Papagiannakopoulos, CESA South Cluster Cybersecurity Services Leader and Associate Partner at EY Greece, spoke about one of the biggest emerging topics in corporate governance. “Cybersecurity is no longer just a technology issue,” he proclaimed, “it is now a business issue.” To show just how important cybersecurity has become, he pointed to some examples of big businesses paying a big price for their shortcomings.

Papagiannakopoulos urged issuers to appoint a Chief Information Security Officer, while also fostering a culture in which everybody recognizes the role they play in keeping data secure. He also urged companies to keep track of wider trends and new regulations that impact their information governance, and to be prepared for the worst, so that if a data breach does happen, they can quickly recover.

Closing Remarks

Socrates Lazaridis, CEO of the Athens Exchange closed the event. “Corporate governance is more important than ever before, now that foreign investors’ interest in Greek businesses is recovering,” Lazaridis said. “Only companies with good corporate governance can gain access to the international investment community.” The Athens Exchange, via its Hellenic Corporate Governance Council, is working closely with the government, but also the Greek regulator, the Hellenic Capital Markets Committee, to update the Hellenic Corporate Governance Code.

The Greek 2020 season will be an interesting year to watch as changes unfold in the market and Greek issuers introduce their first remuneration reports.

“ONLY COMPANIES WITH GOOD CORPORATE GOVERNANCE CAN GAIN ACCESS TO THE INTERNATIONAL INVESTMENT

COMMUNITY.” -SOCRATES LAZARIDIS, CEO, ATHENS EXCHANGE

What are some of the biggest changes you have seen in voting over the years?

Over past years, Lyxor has noted that the exercise of voting rights has considerably strengthened, both in terms of participation in general meetings and opposition to management. More and more shareholders are exercising their voting rights as evidenced by attendance rates in general meetings (from average attendance rates of 60% in 2008 to more than 70% in 2018 in Europe), and they are doing so in a more and more conscientious manner as the rate of opposition is increasing.

This can be explained by the rise in the exercise of voting rights (but also shareholder engagement) in passive management. Being a passive manager today can perfectly align with being an active shareholder. Fiduciary duty, evolving regulatory obligations, the transformation of investors’ demand and, of course, the desire to qualify as a long-term shareholder have made the exercise of voting rights an essential for asset managers no matter what their management style.

Lyxor’s experience has been that the dialogue between issuers and shareholders seems to have improved over the last few years. Issuers contact their main shareholders further and further ahead of the general meeting to gather their expectations and explain their draft resolutions. Shareholders are increasingly transparent about the reason for their vote and no longer hesitate to justify their choices.

What are the key trends that you have observed in the 2019 proxy season?

Beyond compensation topics that have been at the heart of general meetings for a few years now, the 2019 general meeting season was characterized by a major increase in shareholder activism in Europe and particularly in France.

Activism has completely evolved: today the size of the company is no longer a barrier (in Europe we can mention the cases of Pernod Ricard, Nestlé or Telecom Italia). In addition, more traditional investors no longer hesitate to label themselves as activists (Comgest at EssilorLuxottica, Financière de l’Echiquier at Latécoère, DNCA at Lagardère…).

This rise in activism was concomitant to that of passive management and especially to the awareness of passive managers of their vote and the impact they could have in general meetings and therefore in the decisions for the company. Passive managers become a prime target for activists during these campaigns. Lyxor has been solicited on each of these campaigns by both sides (activists and companies).

In addition, climate issues continue to animate European general meetings. Whether it’s shareholder resolutions which ask companies to strengthen their policy in favor of climate transition, or to be more transparent about their targets and their strategy, or interference at general meetings by NGOs.

Finally, this season has been marked by many extra-financial topics discussed at general meetings, such as the introduction of the ‘corporate purpose’ (“raison d’être”) for two French companies (Atos & Carrefour in France). This subject introduced in France by the PACTE law is inspired by the growing movement in the United States of benefit corporations and is now developing in Europe.

Strengthening GovernanceAn interview with Florent Deixonne, Head of the Sustainable and Responsible Investments Team at Lyxor.

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In 2019 did you vote against management significantly more than your peers?

In the first half of 2019, Lyxor’s opposition rate was 22% (stable compared to last year) on the basis of 186 general meetings voted. According to the analysis made last year on the opposition rates of major European asset managers, Lyxor estimates that this rate is consistent with the average.

As pay often dominates the proxy season, are there any corporate governance issues which you feel are not receiving the attention they deserve?

Compensation dominates the proxy season because shareholders have only recently been able to vote on it (following the various regulatory reforms). We believe many other non-financial topics should be of greater interest to shareholders.

First, the level of board diversity in Europe is still very disparate. Although the Copé-Zimmermann law has made it possible to strengthen the diversity of French boards of directors, some European countries still have a lot of progress to make on the subject.

The role and duties of the lead director should also be viewed with more interest, especially in companies when there is a combination of the functions of Chairman and CEO or when the Chairman of the Board is not

independent. In those cases, the lead independent director’s presence on the Board is vital to ensure there is an independent counterbalance to the chair.

Finally, the topic of related-party transactions, which is clearly legislated in France, could be reinforced in Europe. Numerous scandals in recent years have shown that related-party transactions can be value-destroying if they are used for earnings manipulation and expropriation of wealth from shareholders.

If you could introduce one corporate governance reform, either in France or globally, what would it be?

The European Shareholder Rights Directive II significantly strengthens corporate governance issues for both asset managers and issuers. However, some aspects could be more clearly defined.

As mentioned above, the topic of diversity and, more specifically, gender equality is very heterogeneous in Europe. It might be interesting to legislate on the subject which would strengthen the practices of issuers and work towards one of the United Nations Sustainable Development Goals.

Another issue could be the role and duties of the lead director which seems to be different from one country to another and even within the same country from one

company to another. Especially at companies where there is a combination of the Chairman and CEO functions, it would be important to define rules on the role of the lead director as a countermeasure.

If SRD II will introduce say on pay all around Europe, it may be interesting to homogenize the templates of compensation disclosures.

Finally, in the last few months, the subject of double voting rights in Italy has made noise in the press much like when it happened in France 5 years ago with the Florange Law. As a recognized good governance practice, the “one share one vote principle” should be the rule for all countries.

What influences LYXOR’s approach to stewardship? How did you come to create the procedures for engagement with issuers that you currently use?

Convinced of the environmental, social and governance challenges, Lyxor has defined a shareholder engagement policy which is reflected in two complementary areas: an

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“THE TOPIC OF RELATED-PARTY TRANSACTIONS, WHICH IS CLEARLY LEGISLATED IN FRANCE, COULD BE

REINFORCED IN EUROPE. ”

As a recognized good governance

practice, the “one share one vote principle” should be the rule for all countries.

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“LYXOR BELIEVES THAT ASSESSING THE COMPOSITION OF THE BOARD IS ESSENTIAL TO AVOID CONFLICTS OF INTERESTS AND TO FOSTER OPTIMAL EFFECTIVENESS

AND EFFICIENCY.”

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engagement policy between Lyxor and companies; and a voting policy, thereby fulfilling the fiduciary obligations to Lyxor’s clients.

In order to promote best practices in this area, the engagement policy can be divided into two distinct and complementary actions:

• A proactive dialogue before general meetings with a double objective:— Compliment the analysis and vote with a good understanding: these dialogues (meetings or conference calls) are an opportunity to better understand the motivations of companies and the nature of draft resolutions.— Encourage companies to adopt best practices in terms of corporate governance.

• A thematic engagement related to environmental, social, or governance issues and engagement in dialogue with companies that are a cause for concern. The goal is to influence companies to improve or adopt the Corporate Social Responsibility best practices.

Therefore, the engagement activities of LYXOR cover governance topics, ESG issues and climate specific ones.

However, LYXOR notes that compared to the UK, there is a lack of formalization on engagement topics and activities in France, except for one or two

informal groups of investors. It could be interesting to create an entity bringing together investors, regulators and even issuers to share their ideas.

What corporate governance issues does LYXOR plan to concentrate on this coming proxy season?

For the 2020 general meeting season, Lyxor will strengthen its voting policy and continue to analyze in detail the following topics:

• Balanced composition of boards of directors: whether the size of the Board, the proportion of independent members, or the skills represented in relation to the company’s strategy or geographical representation. Lyxor believes that assessing the composition of the Board is essential to avoid conflicts of interests and to foster optimal effectiveness and efficiency.

• Diversity policy: Lyxor recognizes the importance of board diversity in a company’s success, as a diverse board of directors can bring a range of perspectives to address strategic challenges. When considering an

individual’s potential contribution to the board, factors such as cultural and geographical background, gender, age, education, skills (etc.) should be taken into consideration.

• Remuneration policy: As far as compensation issues are concerned, Lyxor has developed a notation grid on the remuneration policies put in place by issuers. This grid groups around twenty criteria weighted dif ferently according to the size of the company. The grid also makes it possible to adjust the score obtained by means of a bonus / malus system according to good or bad practices identified.

• Respect for shareholder rights: the protection of the long-term interests and rights of shareholders is one of the main principles of good corporate governance practices. It involves supporting the “one share, one vote” principle, where shareholders have voting rights in direct proportion to their economic interest in a company.

• Monitoring of ESG controversies: Lyxor considers it the duty of the company’s board to take into consideration the extra-financial risks and opportunities deemed material. It is also the duty of the board to monitor the ESG controversies and take the necessary measures to remedy them.

Thank you Florent.

Compared to the UK, there is a lack of formalization

on engagement topics and activities in France.“

Pub brawl avoided at Wetherspoons AGM

UK pub operator JD Wetherspoon enjoyed a fairly smooth AGM, despite CEO Tim Martin’s vocal clashes with proxy advisers. Shareholders decisively backed Martin’s re-election and the company’s financial statements and reports.

At the core of the row was political spending. The use of company funds to campaign for Brexit, it has been claimed, should have required shareholder approval under UK company law. Wetherspoons never sought this approval, leading Pirc to recommend a protest vote against the annual report. Martin was also under fire because he holds the role of chair as well as CEO, and has done for nearly 40 years despite the UK corporate governance code recommending a nine-year limit on any one individual chairing the board.

However, less than 2% of shareholders opposed Martin’s re-election and a mere 4.7% voted against the annual report. Directors Sir Richard Beckett and Debra van Gene experienced larger revolts, with just over 12% of voted shares opposing their re-elections. When only independent shares are counted, this rises to almost 20%.

Russell Investments defends role of proxy advisers

The US$293 billion Russell Investments has defended proxy advisers and the investors who use their services from critics. Portfolio manager Andrew Zenonos said investors do not “blindly follow” the recommendations of advisers.

The comments from Zenonos, who is also a member of the investor’s voting and engagement committee, come amid heated discussions in the US following the SEC’s proposed rule changes. However, he was speaking in Australia, another market where proxy advisers have been under fire in recent years. Russell is a major investor in Australian companies Harvey Norman and Wesfarmers. Some members of these two companies’ boards have been among Australia’s most vocal critics of proxy advisers recently.

“I would say most of the big end of town don’t just blindly follow the recommendations, they’re having their own discussions as well. I don’t think it’s fair to make a blanket statement that everyone’s just doing what the proxy advisors tell them,” Zenonos told journalists. “When there are things that may be controversial, we’ll take the views from the proxy adviser on board, but then we will also do our own work internally to see if we should be voting that way.”

Top UK companies must appoint more women to hit target

FTSE 100 companies must appoint more female executives if they are to meet a target of 33% gender diversity in executive ranks by 2020. According to the Hampton-Alexander Review, half of new executives must be women to hit the target.

The Hampton-Alexander Review was commissioned in 2016 by the UK government to tackle the lack of diversity on FTSE 350 boards. It has set targets for both boards and executive teams, urging both to be made up of at least one-third women by 2020. Boards are on track to hit the target ahead of schedule, with 32.4% of FTSE 100 directorships held by women as of October. However, executive teams are lagging behind. According to data collected this summer, just 28.6% of executive leadership roles are currently held by women.

“[S]trengthening the number of women in executive positions is critical to achieving long-term gender balance,” said Sir Philip Hampton, chair of the review. “We are still a long way from reaching the target for women in senior leadership roles below board level. Unless half of all appointments made this year go to women – our target for 2020 is not going to be met.”

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News summaryThe latest developments in corporate governance

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“AFTER OVER £1 MILLION IN UNDISCLOSED BONUSES CAME TO LIGHT, SENSYNE WITHDREW ITS PAY POLICY.”

CBS boss will get severance pay without the severance

Joe Ianniello, acting CEO of CBS Corp, will receive a hefty US$100 million severance package on completion of a proposed merger with Viacom. This is despite the fact that Ianniello will not lose his job following the merger.

Iannello will not be chief executive of the overarching entity that the merger will create, but he will remain the head of CBS’ operations. He will also be signing a new contract which will include a pay rise worth tens of millions of dollars. The generous package is being interpreted as an effort to win Ianniello’s support for a merger that doesn’t place him in the top job.

CBS and Viacom separated in 2006 but have maintained close ties. Both are controlled by the Redstone family and share a vice chair in Shari Redstone, who has long been an advocate for reunification. She originally wanted the combined company to be led by Ianniello’s predecessor, Les Moonves, but Moonves was abruptly dethroned in September last year after multiple allegations of sexual harassment.

Standard Chartered cuts pay packages of CEO and CFO

Standard Chartered has cut the pay packages of both its CEO and CFO in response to the backlash by investors over the size of the two top executives’ pension allowances. Bill Winters, CEO of the company, has agreed to reduce his pension allowance from £474,000 to £237,000, while CFO Andy Halford has lowered his from £294,000 to £147,000.

This comes following major criticisms of Winters after an interview in which he hit

out against “immature and unhelpful” investors that had taken issue with his pension allowance. StanChart has been engaging with its investors over the CEO’s levels of pay since its AGM earlier this year, where the bank received close to 40% votes against its remuneration policy.

But the cuts to the two executives’ pension allowances have been well received by both investors and the company. Schroders, one of StanChart’s largest shareholders, said it was supportive of the changes, while the head of corporate governance analysts at the fund manager Daniel Veazey said: “We are pleased that the company has listened to shareholders and are very supportive of this move which brings CEO and CFO pension arrangements into line with the broader workforce, consistent with emerging UK best practice.”

Christine Hodgson, chair of the remuneration committee, said: “I would like to thank Bill and Andy for their willingness to agree to these changes and to thank our shareholders and their representatives for engaging constructively.”

Sensyne hit by rebellion despite reforms

Shareholders of Sensyne have rebelled against executive pay, despite the UK healthcare technology firm’s efforts to head off discontent. 28.7% of shareholders voted against Sensyne’s remuneration report.

After over £1 million in undisclosed bonuses came to light, Sensyne withdrew its pay policy and founder-CEO Lord Drayson agreed to take pay cuts for the remainder of the year. This meant foregoing about half of his £500,000

base salary, with any bonus having to be approved by shareholders before it could be paid. The company hoped this would be enough to placate investors, but this month’s AGM proved otherwise.

The revolt represents an even larger proportion of independent shareholders. Sensyne’s two biggest shareholders are Lord Drayson himself and his wife Elspeth. Together, these two accounted for more than half of the votes cast in support of the report.

FRC calls on companies to improve reporting on climate-related issues

According to a report by the Financial Reporting Council, companies are failing to meet their investors’ expectations for clearer reporting on climate-related issues. The report said that when reporting on climate-related issues, companies should make use of the Task Force on Climate-related Financial Disclosure structure. However, 61% of FTSE 100 companies reportedly made no mention of the TFCD, and only 16% spoke of climate change in their Chair and CEO statements. The report highlights the difference between company reporting and the expectations of investors. Sir Jon Thompson, chief executive of the FRC, has said that: “As societal and investor expectations evolve, alongside the regulatory environment, it is clear companies need to rapidly increase their transparency and improve their reporting to meet this demand.”

By 2022, the UK Government expects all registered companies and large asset owners to report in line with the TCFD proposals.