RI Governance & Engagement, Sept. 15: new European corporate governance head at BlackRock

RI’s regular look at governance and engagement news

Asset management giant BlackRock has named Amra Balic as Head of Corporate Governance and Responsible Investment (CGRI) in Europe the Middle East and Africa. She joins from Standard & Poor’s, where she was a Director in European Corporate Credit Ratings responsible for Corporate Governance; she will report to Michelle Edkins, Global Head of Corporate Governance and Responsible Investment.

Cheuvreux, the French broker research house, has published its 2011 Corporate Governance Voting Guide. It has published a watch list of companies – Aalberts Industries, Endesa, Fielman, Iberdrola, Imtech NV, Publicis Groupe and TUI – which it believe could be of concern to investors on succession. Cheuvreux’s research also indicates that longer CEO tenure can be positive for long-term performance: companies retaining a CEO for more than six years tend to outperform the Stoxx 600.

Goldman Sachs’ Chief Executive Lloyd Blankfein is facing pressure from an activist pension fund to step down as board chairman. The pension plan for AFSCME, the public services employees union, has filed a shareholder resolution asking the firm to appoint an independent chairman. AFSCME President Gerald W. McEntee, said: “A chair is supposed to oversee the CEO. It’s time for Lloyd Blankfein to stop grading his own homework.”

More than 60 of the world’s best known clothing companies including Adidas and Levi Strauss as well as the American Apparel and Footwear Association (AAFA), which represents more than 800 brands, have signed a pledge to not knowingly source Uzbek cotton harvested using forced child labor. The pledge is being coordinated by the Responsible Sourcing Network, a project of As You Sow.

APG, the Dutch asset manager owned by the ABP civil service pension fund, has updated its Governance and Voting Policy. The new document calls for company boards to take account of stakeholder interests and sustainability issues. Boards are expected to take in extra-financial factors in remuneration policy. “APG does not support targets linked to rankings in sustainability indexes,” it adds.

The New Orleans Employees’ Retirement System and Central Laborers Pension Fund have further amended their existing class action suit against media giant News Corp. They allege “rampant nepotism and failed corporate governance” in the wake of the phone hacking scandal and supplement a lawsuit originally filed in March 2011 in Delaware Court of Chancery.Index firm FTSE says nine UN PRI signatory investors have taken up the opportunity to engage with constituents in its FTSE4Good Index. As a result, there was engagement with 65 companies, and progress will be available on the PRI intranet for signatories shortly.

The $152.7bn (€110.7bn) California State Teachers Retirement System (CalSTRS) is considering calling on investee companies to disclose their political spending – or risk facing shareholder resolutions on the matter, according to a report in Pensions & Investments. A draft policy proposal is being put together for a meeting in November.

The Toronto Stock Exchange (TSX) has put forward new rules for listed firms, which would let shareholders cast votes for each individual director on the board rather than the whole board as a slate. The move comes as the Ontario Securities Commission is deliberating on the issue, according to a report in the Globe & Mail.

Socially responsible investing advisory firm Harrington Investments says it has tabled a shareholder resolution calling for chemicals firm Monsanto to publish a study on the financial risks of its genetically modified organisms (GMOs) products. Monsanto is likely to hold its annual shareholder meeting some time in January 2012.

Two Detroit City pension funds, the $2.7bn General Retirement System and the $3.6bn Police & Fire Retirement System have sued BNY Mellon in the U.S. District Court, Southern District of New York. They allege the banking giant mishandled their funds in the run-up to the collapse of Lehman Brothers. Complaint

SGX, the Singapore Exchange, has amended its listing rules to “strengthen corporate governance practices and foster greater corporate disclosure”. It follows a consultation last year and takes effect from September 29.

The European Securities and Markets Authority has launched a call for evidence on so-called “empty voting” – where there are voting rights but no economic exposure. There are no specific rules coring this at the European level, ESMA said. The deadline for responses is November 25.

The £166m Joseph Rowntree Charitable Trust has signed up to the UK Stewardship Code. It says Jackie Turpin, Head of Finance, can be reached by email “by those interested in collective engagement”.