UK - The Trades Union Congress (TUC) has demanded the government introduce legislation forcing fund managers to disclose how they are voting on company AGM decisions.
Publishing the results of its 2005 Fund Manager Voting Survey on how 50 investors voted in 50 controversial company AGM decisions last year, general secretary Brendan Barber (pictured) said: “Over half of investors are providing us with information to publish but most are unwilling to publish this themselves. The government should change the law to open up AGM voting to the public glare, as they did so effectively on executive pay.”
Barber said forcing managers to disclose their voting records would “start a shift towards a new era of exemplary investor governance”.
Responses to the survey on AGM votes include executive pay deals at J Sainsbury, WH Smith, Jarvis and Compass. The TUC plans to lobby the government to include a requirement for fund managers to disclose voting records as part of its recently published Draft Company Law Bill.
“The TUC's Fund Manager Voting Survey shows that the investment industry will not embrace true transparency without government action, just as many investors did not act on executive pay until the government introduced a mandatory vote on pay at AGMs,” the union said.
Separately, Barber warned reaching pensions consensus in the UK should not mean vetoes all round.
“Every radical idea has important opponents, and if everyone has a veto in the name of consensus then there will be no agreement, Barber said. “Some suggest incentives, yet the evidence from the US in particular is that these don’t really work - and spending money on incentivising people who would do it anyway is not very sensible. A new settlement will not come from the search for a consensus now, but it will be possible to build one around a practical and fair package of reforms.
“The minimum wage was highly controversial before it was introduced, but is now everyday common sense, which is taken above day-to-day politics by the Low Pay Commission. This is the model the government and the Turner Commission should follow. Bravery with objectives and the basics of a new pensions structure, but maximum consultation and consensus about the detail of implementation.”
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