Speaking up turns into a main event
January 15, 2008
This article by Gillian Bullock appeared in Fairfax Media's NSW Sunday paper The Sun-Herald on May 25, 2000.
Share activist Stephen Mayne hopes to galvanise small shareholders into action in his war against lazy fund managers who sit on the fence rather than criticise company boards. Mr Mayne stood for a board seat at the recent AMP annual meeting and garnered 21.8 per cent support a massive 29 million votes.
Although he failed to win the seat, another 105 million who had voted for the other AMP-endorsed candidates abstained. Not that you'll read about it widely the renegade finance journalist has burnt bridges with several newspapers.
AMP chairman Stan Wallis commented: ``The biggest threat is that you get elected somewhere and that will curtail your activities."
But Mr Mayne does not think that will happen. Rather, he wants to use board nominations to air his concerns about companies.
He is urging fund managers to stand up at annual meetings and ask pointed questions rather than to acquiesce quietly to all motions put before them or, even worse, not bother to vote at all.
Mr Mayne said AMP had 174 shareholders with more than 100,000 shares representing 40pc of the company. Only about a third of these bothered to vote and many abstained or allowed Mr Wallis to vote on their behalf.
"Many of these so-called guardians of your savings really are lazy, as Financial Services Minister Joe Hockey called them recently."
Mr Mayne's next target is the Optus meeting in August, when he wants to stand for the board on a platform of outrage at the continuation of cash-for-comment deals.
"I am appalled at cash for comment," he said.
"There has been a systemic failure and the commentators are still being paid. I am shocked so I'll try and embarrass those people paying the cash so they will stop."
But first he plans to travel to London to attend the annual meetings in July of Optus parent Cable & Wireless and Qantas parent British Airways, where he will air his concerns over the cash-for-comment controversy. He also has a few other companies in his sights, including Westfield.
"Westfield Holdings, in which the Lowy family has about 30pc, has increased its share price more than 20 times in the past 10 years while Westfield Trust, in which the Lowys have no holding, has managed to rise less than 50pc," he said.
"There is $4.5 billion worth of development flowing between the trust and the holding company. The upside is flowing up to the holding company. Both have the same board but here is a clear case for the trust to have some independent directors."
His pressure group, shareholder.com.au, will be more active than the Australian Shareholders Association (ASA).
"We are all singing from the same song sheet. I might just be a little more aggressive and take a stronger position," he said.
Shareholder.com.au is a profit-making organisation, is more aggressive than the ASA, appeals to a younger and more professional demographic and is distributed solely online.
It has more than 300 subscribers and Mr Mayne hopes this figure will hit 1,000 by the end of the year.
He welcomed the stand of Peter Morgan, Perpetual Funds Management's head of equities, who attacked AMP chief executive Paul Batchelor's 1.2 million options exercisable at $15.93 when the National Australia Bank's $21 a share bid had been spurned.
But Mr Morgan downplayed his role. ``We have done this before with Siddons in October last year when we thought it was losing direction," Mr Morgan said.
"We move to protect our position and try and do what is right."
He said many small shareholders were disadvantaged as they were not consulted by company boards while the institutions were.
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