Meritas Mutual Funds announced Friday the filing of a shareholder proposal requesting the adoption of an advisory vote on executive compensation.
The resolution, commonly referred to as “Say on Pay,” was submitted at eight Canadian companies: Bank of Montreal, Bank of Nova Scotia, CIBC, Nortel Networks, Royal Bank of Canada, Sun Life Financial, Toronto-Dominion Bank and TMX Group.
The Meritas proposal asks that shareholders be given an annual, management-sponsored vote on the board’s executive compensation report. This vote will be advisory only, providing directors with valuable feedback while not usurping their ultimate authority to make decisions about pay.
In explaining Meritas Mutual Funds’ motivation for the filings, CEO Gary Hawton explained: “Canada’s largest issuers provide their shareholders with solid, and ever-improving, executive compensation disclosure, but no efficient and inclusive way to respond to the decisions that have been made by the board on their behalf.”
Hawton continued, “If that disclosure was to ever bring a real problem into sharp focus, shareholders need to be able to do more than read about it. They need equal access to comment about it and the most efficient way to do so is through a vote”.
This is the second outing for Meritas’ advisory vote proposal in Canada
The Shareholder Association for Research and Education’s director of law and policy, Laura O’Neill, noted that. “This proposal received average shareholder support of 40.5% when Meritas put it on the ballot at the 2008 annual meetings of Canada’s five largest banks. None of the banks elected to implement the advisory vote, though each indicated that it would monitor shareholder views on the matter. The best and most obvious way for all shareholders to provide them with this information is to have a vote.”
If none of the corporations choose to act on Meritas Mutual Funds’ proposal prior to their AGM, investors will be called upon to cast a vote on the resolution at that time.
IE
Meritas submits “Say on Pay” shareholder resolution
Fund manager targets banks, TMX, Sun Life and Nortel
- By: IE Staff
- October 26, 2008 October 26, 2008
- 15:10