Over 32 per cent of shareholder votes opposed ANZ’s executive pay report, delivering a second consecutive strike for the major bank.
ANZ shareholders delivered a second strike against the bank’s executive pay plans at the 18 December annual general meeting, capping off a turbulent year for the bank.
A total of 32.4 per cent of votes were cast against the firm’s remuneration report, well above the 25 per cent threshold required to trigger a strike.
In Australia, the two strikes rule is designed to hold boards accountable for executive salaries and bonuses. Under the law, if shareholders vote against a company’s remuneration report in two consecutive years, board members can face a spill if investors believe pay is excessive relative to performance.
However, in this instance, a board spill was voted down with only 1.5 per cent of ANZ shareholders supporting drastic action.
Meanwhile, despite ongoing frustrations, board chair Paul O’Sullivan was re-elected for his final three-year term. He secured 95 per cent of shareholder support, telling attendees that he intends to transition to a new chair during the term.
The development follows a troubled year for ANZ, with the bank recently agreeing to pay $240 million to ASIC after the regulator alleged multiple failings.
These failings included incorrectly reporting bond trading data to the federal government, along with widespread misconduct in its retail division which affected tens of thousands of customers.
At the time, ASIC chair Joe Longo said ANZ had betrayed the trust of Australians “time and time again”.
“The total penalties across these matters are the largest announced by ASIC against one entity and reflect the seriousness and number of breaches of law, the vulnerable position that ANZ put its customers in and the repeated failures to rectify crucial issues,” Longo said.
Just last week, it was also reported that ANZ is preparing to defend a court proceeding by former CEO Shayne Elliott over allegations bonuses of $13.5 million were withheld from him. Elliott claims ANZ breached the terms of his departure agreement when the board cancelled his multi-million-dollar bonus.
The AGM also unveiled ANZ’s 2030 strategy, centred on four priorities: customer first, simplicity, resilience, and delivering value.
Chief executive Nuno Matos – who was appointed in May of this year to replace Elliott – told attendees: “Our refreshed ANZ 2030 strategy, unveiled in October, lays out a clear plan to materially improve the performance of our Australia Retail and Business & Private Banking divisions, while extending our leadership in Institutional and New Zealand.
“At the heart of this strategy is our ambition to unlock ANZ’s potential to win the preference of customers, shareholders and other stakeholders.”
In his address, Matos also acknowledged the impact on customers caused by the bank’s failings this year: “Despite our good intentions, we have not consistently lived up to the expectations of our customers across all of our businesses.
“I want to stress to you today that we are going to get back to growth by getting back to basics and relentlessly focusing on customers across every segment and business of ANZ.”
