While proxy advisers are not new kids on the block, their influence in the Australian boardroom is becoming more profound. Specialising in researching and analysing proposals being put forward for a vote by shareholders, proxy advisers should — first and foremost — be guided and committed to the longstanding principles of good corporate governance.
In a previous role in the UK, I worked with an insurance company and was assigned to a client that processed poultry. They were a global player with factories in multiple jurisdictions, and lots of supply chain risk exposure. I distinctly remember the day I asked them about their approach to crisis management, and their representative (a senior executive) pointed towards the cones and first aid kit in the back of the Range Rover.
Hubristic individuals are a threat to governance in all organisations. For all the money and time business spends on risk management, building complex models and using quantitative statistical methods, it needs to devote at least as much money and effort to biological, chemical and human resources research on personality and behaviour.
As in previous years, the 2017 report is based on remuneration data covering 1,021 boards and collected from 390 online contributors (mostly Governance Institute members), 261 boards which are ongoing contributors to the survey and 370 client boards of McGuirk Management Consultants.