AMP has received a ‘first strike’ at its AGM in Melbourne after 60 per cent of its shares were voted against the company’s remuneration report.
AMP interim executive chairman Mike Wilkins opened yesterday’s AGM in Melbourne with a 20-minute speech in which he apologised for “letting down” shareholders, customers and “the wider community”.
Mr Wilkins pointed to a “small number” of AMP advisers that “made the decision not to follow policy” and inappropriately charge fees-for-no-service.
“The situation was compounded through a series of communications that misrepresented the issue to – and therefore served to mislead – our regulator on several occasions,” Mr Wilkins said.
Mr Wilkins also fielded questions from AMP shareholders at the meeting, several of whom expressed their disappointment about incoming chair David Murray’s absence.
“David Murray will take up his role no later than 1 July this year. He has some prior commitments which he is working through. But I also know that he is keen to be here as quickly as he possibly can,” Mr Wilkins said.
“Shortly after that, I’m sure that he will communicate to our shareholders the agenda which he intends to follow,” he said.
A representative from the Australian Shareholders Association asked why AMP’s board did not appear to have a crisis management plan in place following the revelations at the royal commission.
Mr Wilkins said the AMP board acted “very quickly and decisively” upon becoming aware of the fees-for-no-service issue, which he pointed out was known to the company before the royal commission hearings.
“Some of the revelations at the royal commission were news to us, but what we have done is move as quickly as we can and as decisively as we can,” he said.
There were only two resolutions presented by AMP at the meeting: that Andrew Harmos be re-elected as an independent director, and that the 2018 AMP remuneration report be approved.
Resolutions relating to the remuneration of former chief executive Craig Meller and the re-elections of Holly Kramer and Vanessa Wallace were withdrawn, given the resignation of all three in the lead-up to the AGM.
Mr Harmos was re-elected as a director with a significant protest vote of 37.67 per cent, with 62.33 per cent of shares voted ‘yes’.
However, the remuneration report was not adopted, with 61.46 per cent of shares voted against the resolution.
As a result, AMP had a ‘first strike’ recorded against it, since more than 25 per cent of shares were voted against the remuneration report.
If more than 25 per cent of AMP’s shares are voted against the 2019 remuneration report at next year’s AGM, the board of AMP will automatically be spilled.
Activist shareholder Stephen Mayne called on Mr Wilkins to put all of the board up for election next year.
“There’s potentially a second strike next year, which triggers a board spill. So if you make a public commitment that all of the directors agree that all of you will be up for election next year it will be a good act of accountability,” Mr Mayne said.
In reply, Mr Wilkins said he suspected the constitution of the AMP board “will look very, very different this time next year compared to what it looks like today.”
“I will take you request on board, I will discuss it with the chairman-elect and we will let shareholders know at the appropriate time,” he said.
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