Our Free Speech event, My tuppenceworth, on Tuesday 19th November gave lots of people the opportunity to speak. One of those speeches came from Gavin Palmer, we have reproduced the text below.
It needs the long title Shareholder Nomination to the AGM Committee (SNAC) as the long title explains what it is and does rather than being seen as just a shareholders committee meeting when all meetings must include the Chairman of the Board.
The committee by the nature of who attends it, are likely to have more than 5% of the companies shares so they could call an EGM within 14 days to vote on a resolution that they have just written. That resolution would also include up to 1000 words of explanation and be sent to every shareholder on the shareholders register.
The board would also likely have to rebutt the resolution which given that the petitioners are some of the very largest shareholders vs their servants the board of Directors would be interesting and most likely shareholders would favour the largest shareholders.
The committees cheap, simple formation would solve excessive pay, bonuses for failure, stop board infighting and politiciking over the top job of being a CEO, select truly the very best team leader for the job regardless of the commissions payable to the headhunters (related to high pay, high bonuses, high share awards) and the upping entire boardroom pay regardless of performance.
Also it enables the owners to smoothly replace bad CEOs or Chairman before they do too much damage without being ransomed or blackmailed. Also if the company needs a rights issue, the Chairman just asks those around the table if they would back the rights issue and job done 3 underwriters!
Opposition: The priveledged access given to the gatekeepers :- the big fund managers Blackrock, Legal & General, Norges Bank, Insight who don’t want to increase their costs or accountability to manage or be involved attending the committees and unable to trade on ‘insider hints/tips’ they gained.
Weak points of this opposition: public press embaressment of pension funds refusing or just not attending a short meeting with the chairman when they have £100million invested in them (It worked in Sweden!) – they then attended the next year!
1) invite chairman and the largest beneficial chairman to a meeting with Sharesoc of many plcs
2) gather 140 activists, give them a single share plus add a large shareholder and submit a full shareholder resolution requisitions to plcs.
Option 1 is cheaper and easier
Option 2 is involved but gets wide coverage and attention.
Hmm thanks to this I think I should add a draft resolution to the wikipedia page and add SNAC.