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Are you prepared for proxy season?

(Sponsored article) The year 2020 continues to present many unknowns and the mettle of our community has been tested and strengthened every day. The global pandemic has disrupted issuers’ plans for growth and, in some cases, the ability to operate altogether. The business community is delicately balancing the interests of shareholders, employees, suppliers and many other stakeholders.

Issuer responses to the pandemic have varied. We’ve seen issuers raising capital to strengthen balance sheets, shelving expansion projects, cutting their workforce or continuing as planned, believing they could weather the storm.

Much has been written about what issuers have done as a result of the pandemic and, the upcoming AGM season gives investors the opportunity to have their say as issuers submit their remuneration reports for approval and directors seek re-election.

In this article, we share our insights into some of the key issues to look out for this proxy season.

Remuneration and financial results

The approach to executive remuneration, as well as the impact of government support packages on financial results are both important issues to be considered in the lead up to AGM season.

All four major Australian proxy advisors have commented on what they, and their institutional investor clients, expect from issuers this year.

This includes:

  • boards exercising restraint when considering executive bonuses to ensure pay aligns with the pain felt by shareholders, employees and the community
  • providing a clear outline of how stimulus measures, such as JobKeeper and similar grants in other countries, have impacted financial results
  • disclosing any adjustments to performance targets in light of the pandemic.

To read the full article and learn more about the key issues to prepare for this proxy season, click here.

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