Australia’s Local Government Super to reject pay at AMP and support climate resolution at Bank of America

LGS becomes first super fund to pre-release voting intentions

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Australia’s A$8bn (€5.7bn) Local Government Super, releasing its voting intentions for the first time, says it plans to vote against pay at Sydney-based financial services firm AMP and in support of a shareholder climate change resolution at Bank of America.

It is voting against the remuneration report at AMP on May 7, saying an executive pay increase is “excessive”. It is also voting against the equity grant made to top management saying there is an “insufficient performance hurdle”.

At Bank of America, it is supporting a resolution filed by the Sisters of the Holy Names of Jesus and Mary calling for the bank to assess the greenhouse gas emissions of its financing portfolio and its exposure to climate change risk in its lending, investing, and financing activities. The justification is that LGS favours “increased environmental reporting/responsibility”.

LGS, which has around A$5bn invested in responsible investment strategies, said it has launched a new shareholder voting website, which it says makes it thefirst super fund in Australia to disclose its voting intentions in advance of company shareholder meetings.

LGS’s Chief Executive Peter Lambert said it aimed to “increase transparency and disclosure of how we invest our members’ retirement savings”.

The site uses CGI Glass Lewis’ Viewpoint voting platform and Lambert added: “Voting at shareholder meetings forms a key element of this engagement and is an important element of our ownership rights as long-term investors.”

As a rule LGS votes in accordance with recommendations of the Australian Council of Superannuation Investors (ACSI) and CGI Glass Lewis, but will vote against them if its believes there is a long-term ESG risk which may lead to the loss of shareholder value.

LGS has voted against company proposals in the past as a result of concerns with issues such as board diversity and independence, remuneration and sustainability reporting disclosure and climate change.