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RI Governance & Engagement, August 25: Investors urge SEC to pursue proxy access case

RI’s regular review of governance and engagement news

The Council of Institutional Investors – the US nonprofit association of pension funds and endowments with combined assets of more than $3trn (€2.1trn) – has written to Securities and Exchange Commission Chairman Mary Schapiro urging the SEC to pursue a rehearing of the controversial proxy access case against the Business Roundtable and U.S. Chamber of Commerce. The case was dismissed last month; proxy access makes it easier for shareholders to get their own nominees onto corporate boards.

Andra AP-fonden, the SEK227.5bn (€25bn) Swedish state fund, says it is keen to participate in a “down-to-earth debate” about raising the percentage of women on listed companies’ boards. “We are also interested in broader issues concerning diversity, such as age, background, experience and competence,” the fund says in its new half-year report. It is convinced a broader recruitment base leads to better boards and management – which “can create better and more valuable companies”. Link

The $154.2bn (€107bn) California State Teachers’ Retirement System (CalSTRS) has met with News Corp.’s Chief Operating Officer Chase Carey over the phone hacking scandal, according to a Bloomberg News report citing CalSTRS. “CalSTRS is involved in the engagement process, which includes sending letters, holding conference calls and meetings, with News Corp. management,” a fund spokesman was quoted saying.

Institutional investors in emerging markets should take more responsibility for building a sustained dialogue with investee firms on corporate governance. That’s one of the conclusions of Corporate Governance in Emerging Markets: Why It Matters to Investors—and What They Can Do About It. The study – by Melsa Ararat, Director of Corporate Governance Forum of Turkey and George Dallas, Director of Corporate Governance at F&C Investments – is published by the IFC’s Global Corporate Governance Forum.

The International Corporate Governance Network (ICGN) plans to roll out the world’s first environmental, social and governance (ESG) classes for global investors on the topics of engagement, alliance building and communication from early next year, according to an interview with ICGN Executive Director Carl Rosen in the Financial Times. He also said he’d like to see the network have a stronger presence in Asia.The Tokyo Stock Exchange and the World Bank’s International Finance Corp. have agreed to cooperate in developing capital markets in emerging economies – “helping protect investors through better corporate governance, ensure fair markets, and spur economic growth”. The pair will work via the IFC’s Global Corporate Governance Forum. Announcement

Proxy infrastructure firm Broadridge Financial Solutions has announced that its ProxyVote.com platform will now be available on mobile data devices such as smart phones and tablets for Canadian shareholders. It added that 20m proxy votes were recorded through the system in the year to the end of June.

A proposal from Trillium Asset Management and Calvert Investments calling on US food group J.M. Smucker Co. to disclose its plans to address climate change gained almost 20% shareholder support at the company’s annual shareholder meeting earlier this month. Some 45% voted against while 13.25% abstained. Trillium’s Jonas Kron was quoted by the Cleveland Plain Dealer as saying the fact that 33% of voters didn’t side with Smucker “sends a really strong message to the company”.

US companies have improved their explanations about executive pay, although more needs to be done, says Ken Bertsch, CEO of the Society of Corporate Secretaries and Governance Professionals. “Better than they were, but still not great,” he said in an interview with the New York Stock Exchange’s Boardmember.com. Larger companies have made “pretty good strides this year” because of say-on-pay.

Consulting firm PwC has launched a corporate governance iPad app. The free download “provides timely insights on corporate governance issues and trends to enable board members to more effectively meet the challenges of their critical role”. Link

The Australian Institute of Company Directors has launched a new book called ‘Tomorrow’s Boards: Creating Balanced and Effective Boards’. Written by Anthea McIntyre, it looks at the composition of Australia’s boards, their selection practices and the “advantages inherent in diversity”. Announcement