See the client briefing for the detail. The table below shows some key areas covered.
In addition, three more recent developments are relevant to the AGM season and are worth briefly noting.
- Pre-Emption Group expectations for disapplication thresholds re-confirmed. The Pre-Emption Group issued a further announcement (following their announcement in July 2017) re-confirming that despite the Prospectus Regulation introducing a new exemption from the obligation to publish a prospectus for issues of up to 20 per cent of issued share capital, it will not be changing its Statement of Principles and that that the 10 per cent limit in the Statement of Principles still applies. It also states that whilst decisions about specific placings are for individual shareholders, the Statement of Principles reflects the agreed position supported by the Investment Association and the Pensions and Lifetime Savings Association. It further states that companies and investors are encouraged to use the Statement of Principles and its Appendix of Best Practice when engaging on pre-emption issues.
- Government research on how companies use share buybacks. The Government has announced new research, to be conducted by PwC and Professor Alex Edmans of the London Business School, into how companies use share buybacks. The research will look at the motivations for and effects of doing share buybacks and whether action is required to prevent them being abused (for example by investigating whether they are used to artificially inflate executive pay). The findings will be published later this year.
- PIRC revised voting guidelines. In March 2018, Pensions & Investment Research Consultants (PIRC) issued its 2018 UK shareholder voting guidelines replacing its 2017 edition. The guidelines represent the latest expression of PIRC's view of what constitutes good governance practice (to the extent that companies choose to follow them). Key changes or updates include the following.
- Strengthened guidance stating that PIRC will oppose the re-election of a chairman beyond their initial appointment if he/she has significant independence issues (excluding tenure).
- Boosted guidelines on executive chairmen, where PIRC states that holding an executive chair position will justify a recommendation to vote to oppose.
- Strengthened guidelines on audit and remuneration committees, where PIRC will oppose the re-election of any non-independent member.
- Changed guidelines on directors and attendance at board or committee meetings, where PIRC will now oppose the re-election of any director who misses any meeting without adequate justification.
- In relation to virtual-only meetings, noting that PIRC will oppose amendments to articles of association that permit virtual-only meetings.
For a full list of our corporate partners and consultants please see page eight of the PDF or contact any of the key contacts listed below.
