UK - Wm Morrison Supermarkets is facing a shareholder backlash, despite concessions towards corporate governance best practice.
Pension funds and investor lobby groups have welcomed Morrison’s appointment of two non-executive directors to its board but warned more change is needed. The supermarket giant – the fourth largest in the UK – has repeatedly ignored calls from investors for compliance with the combined code.
But chairman Sir Ken Morrison last week named two outsiders to join the board of seven executives – fashion retailer Next chairman David Jones and house builder Persimmon chairman Duncan Davidson.
The concession came days before the chairman’s self-imposed target of appointing the non-executives ahead of Morrison’s 2004 annual general meeting.
The late announcement left voting agencies and shareholder bodies adding amendments to original recommendations but some said many institutions had already cast their votes.
The National Association of Pension Funds said it would be pushing the company to go considerably further in meeting best practice.
An NAPF spokesman said: “While this is a step in the right direction, we now want to see a shake-up in the management structure. Currently there is no remuneration or audit committee, and the nomination committee is made up of executives – clearly this has to change.”
Investor lobby group Pensions Investment Research Consultants said the supermarket was “still a long way from combined code compliance” and called for opposition to the re-election of auditor KPMG, due to the level of non-audit work carried out.
And proxy voting service Manifest flagged up potential concerns for investors, including the absence of any independent non-executives on the board, bonuses and benefits included as pensionable pay, and insufficiently challenging performance targets for executive shares.
PTL has appointed Karein Davie as a client director in its Birmingham office.
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The number of DB pension scheme trustees targeting a buyout with an insurer has increased significantly in the past five years, latest research from Willis Towers Watson shows.