UK - The Institute of Directors has accused proxy voting agency Manifest of misleading pension funds with its research on corporate governance practices.
Manifest has stated that none of the FTSE100 companies is fully compliant with Derek Higgs’s recommendations on remuneration, nomination and audit committees.
Manifest also pointed out that research showed 83 of the FTSE100 chairmen were not independent under Higgs’s guidelines.
But IoD corporate governance executive Patricia Peter said pension funds should look beyond numbers and must not be misled by figures.
She said: “What people should look at closely is the explanation behind the ‘non-compliance’, not just base analysis on the fact that they aren’t complying.”
Manifest managing director Sarah Wilson defended the agency’s research and stressed that the qualitative analysis was aimed at gauging the impact the review’s proposals will have on industry and what degree of change would be needed.
She said: “Many of these things were contained in the old combined code.
“The facts are what they are – until we see the compliance statements, we can’t go much further than that.”
She added that it was up to shareholders to “roll their sleeves up and get involved”.
Wilson commented: “Higgs has consulted very widely, it has been a very detailed process and there has been a lot of ill-informed comment on the impact of Higgs. We are looking forward to a robust debate with companies.”
The National Association of Pension Funds recently had to defend the Higgs Review from criticism by a number of companies including Liberty International.
Its chairman, Donald Gordon, said the proposals were unrealistic, impractical and likely to be seriously detrimental to business if adopted.
NAPF chief executive Christine Farnish rejected Gordon’s view and said it was the prerogative of any company board to decide if parts of the code were not appropriate and explain why.
Companies have until the end of next month to comment on the proposals.
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