The 2012 company AGM season has seen a surge of votes against incumbent boards, most notably on remuneration, followed in many cases by the departure of one or more senior members of the board. The press have dubbed it the "shareholder spring", in a slightly ironic reference to the Arab spring of 2011.
What has been going on? Does it mark a watershed in investor behaviour? Or is it a reaction to growing political and public pressure to "do something" about boardroom excess? Are they simply trying to keep Vince Cable off their backs? I suspect the truth is a bit more prosaic. When investors vote at company meetings, they generally do so on the basis of economic factors rather than political or other extraneous ones. When a company is doing well, investors will want to support the board and management. Problems arise though when profits and performance are less good, when it is felt the...
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