RI Governance & Engagement, Jan. 19: Tokyo exchange planning governance changes

RI’s regular round-up of governance and engagement news

The Tokyo Stock Exchange is planning to introduce new corporate governance rules later this year, according to a Dow Jones report citing local news agency Kyodo. TSE President Atsushi Saito was quoted as saying the move to eliminate “cozy relations” in Japanese corporates follows the Olympus accounting scandal.

Fund manager Baillie Gifford is engaging with two companies – Dragon Oil and Compagnie Financière Richemont – on behalf of the £257m (€308m) Lothian Buses Pension Scheme, according to its latest engagement report. It wants Emirates National Oil Company-controlled Dragon to review its environmental responsibilities and disclose remuneration, environmental, health and safety performance.

Australia: the Association of Superannuation Funds of Australia (ASFA) and the Financial Services Council (FSC) have called for directors’ remuneration to be publicly disclosed, according to an item in Super Review. The groups made the demand in separate submissions to a regulatory discussion paper.

The UK’s fraud investigator intends to confiscate shareholder dividends paid by companies convicted of criminal offences, after it won approval for a landmark court action, according to a Financial Times report. “Shareholders and investors in companies are obliged to satisfy themselves with the business practices of the companies they invest in,” Serious Fraud Office Director Richard Alderman was quoted saying.

Publicis Consultants, part of French communications giant Publicis, has signed a joint venture with Paris-based Passariello Zweibaum corporate governance advisory (PZcga), to advise corporates and investors on the growing governance activities of institutional investors. PZcga has worked with companies including Louis Dreyfus, Lazard Asset Management et BNP Paribas Asset Management, ISS and Glass Lewis.
The UK government will limit cash bonuses at state-backed banks such as Royal Bank of Scotland and Lloyds to £2,000, according to Prime Minister David Cameron quoted by Reuters. It comes amid reports that leading RBS investors are urging its board to defy political pressure and pay CEO Stephen Hester a “substantial” 2011 bonus. Sky News reported RBS Remuneration Committee Chair Penny Hughes has begun meeting shareholders ahead of what is set to be a contentious pay round.The California Public Employees’ Retirement System (CalPERS) has submitted a shareholder proposal calling for majority voting of directors at computer giant Apple. CalPERS says it will empower shareowners to say “no” to unopposed directors. The company, which is resisting the motion, holds its annual shareholder meeting on February 23. Apple’s proxy

Trillium Asset Management and Green Century Capital Management have filed shareholder resolutions at Bank of America, 3M and Target Corporation urging them to stop making political donations in the future. “This is the first time institutional shareholders have asked corporations to entirely refrain from political spending,” they said.

A thesis on sustainability targets in executive remuneration has won a prize from Dutch corporate governance forum Eumedion. Erasmus School of Economics graduate Sanne Roosendaal was awarded the annual prize for her work: “Sustainability targets in executive remuneration: An analysis of the contribution of sustainability targets in executive remuneration to sustainable development.” Link

The Northern Ireland Local Government Officers’ Superannuation Committee (NILGOSC), the Belfast-based pension fund, has tendered for a custodian, whose duties will including voting. The search is being administered by Aon Hewitt and closes on February 27.

Institutional Shareholder Services, the US proxy firm, is hosting a webinar next week on shareholders’ political spending proxy proposals. The guests for the January 25 event include: Bruce Freed, Center for Political Accountability; Timothy Smith, Walden Asset Management; and John Keenan, American Federation of State, County, and Municipal Employees (AFSCME).
Meanwhile, the $850m (€659m) AFSCME has announced its 21 shareholder proposals for the forthcoming proxy season. It is seeking “greater director accountability, independent corporate board leadership, and greater transparency” in investee companies and is taking aim at “imperial” chief executives. Announcement

Manifest, the advisory firm, has released new analysis looking at executives sitting on the remuneration committees of other companies. It suggests any regulatory action should be “delicately framed” so as not to deter junior directors gaining experience.