A webinar hosted by law firm Mason Hayes & Curran (MHC) LLP has been told of a “marked decline” in the level of shareholder engagement with Irish public companies over the past year.
In a discussion on the 2021 season of annual general meetings, MHC corporate partner Justin McKenna said that the drop-off in shareholder participation had been particularly sharp in the banks, and in Ryanair.
The webinar (9 December) heard that many Irish-listed and UK-listed firms continued to hold ‘closed’ or ‘semi-closed’ AGMs this year, due to COVID-19 restrictions.
Gender balance
McKenna said this might have been one of the factors behind the fall in shareholder engagement, but he also pointed to the amount of detailed instructions that retail shareholders needed to read, describing them as “mind-boggling”.
Corporate partner David Mangan said that 96% of the listed companies tracked by MHC held votes on their annual directors’ remuneration policies. Two of these – Kingspan and Cairn Homes – recorded a vote of 22% or higher against the resolution.
Mangan pointed out that the percentage of firms seeking approval for dividend payments (40%) was the same as in 2020, but below the usual pre-pandemic level of around 50%.
On gender balance, MHC found that 67% of Irish board members were male, with 33% female. This was, however, from a mixed sample of Irish- and UK-listed companies.
Only just over half of Irish-incorporated listed companies had a board with 33% or higher female representation.
Six companies were ‘at or near’ gender parity, but two had no female representation on the board.
Glass Lewis to track board diversity
Bernadette O’Donoghue of Glass Lewis, which advises investors on corporate-governance issues, told the webinar that companies listed on Dublin’s ISEQ market should work towards a target of having female representation of at least one-third on the board by 2023.
From 2022, she added, Glass Lewis would be expanding its analysis of ISEQ companies to include an overview of disclosure surrounding the board-level diversity of ethnicity.
The company recommended votes against 48 directors of FTSE companies at AGMs, mainly linked to gender diversity and pay practices.
Votes against five directors of Irish companies were advised, with three of those due to issues surrounding the composition of various board committees.
Glass Lewis also came out against three remuneration reports at Irish companies – mainly due to concerns about their design, as well as disclosure requirements.
It also recommended a vote against Irish Continental Group’s remuneration policy, amid concerns about a lack of disclosure in a bonus scheme for its chief executive.