Questions for your Manager - September's 2015

The NAPF publishes monthly topical questions to aid trustees in considering the effectiveness of their managers’ stewardship activity.  We encourage funds to ask these questions during their regular manager reviews in an effort to understand their managers’ approaches and activities and to ensure that they are adhering to the stewardship policies.

SEPTEMBER'S TOPICAL QUESTIONS FOR YOUR MANAGER

1. Changes made to the Listing Rules which came into force last year mean that non-executive directors of companies with a controlling shareholder need to receive a majority of support from both the totality of shareholders and the minority shareholders.
   
   This time last year many investors publicly questioned the governance arrangements at Sports Direct, and ahead of next week’s AGM it is clear that for many these concerns remain with some analysts cautioning earlier this year that governance at the business is “an issue” and was deterring institutional investors from buying the stock. Given the enhanced accountability of directors in controlled companies to minority shareholders and on-going concerns what engagement have you had with the company and in turn how have you cast your votes in respect of the re-election of the non-executive directors at Sports Direct?


2. Earlier this summer the target for 25% female representation on FTSE 100 boards was met. When the Davies review was launched in 2011 there were 152 all-male boards across the FTSE 350, there is now not a single all-male board in the FTSE 100 and less than 20 in the FTSE 250.
   
   The focus of many is now shifting to the pipeline of talent and translating the progress made on diversity amongst non-executives to the executive management team and wider workforce; in line with this the NAPF has encouraged government to press ahead with proposals to require companies to publish their gender pay gaps. How do you assess whether companies are making full use of the talent available to them and what use, if any, would you make of consistent disclosure of gender pay gaps?

Read previous month's questions here.