Time to give shareholders real power over directors’ rewards?

As yet another shareholders meeting registers disapproval of executive pay, this time at easyJet, the question arises as to whether now is the time to hand some greater control over directors remuneration to shareholders.

Read more »

A shareholder dispute need not result in a messy divorce

When you specialise in dealing with shareholders disputes you become more of a commercial divorce lawyer than a commercial litigator.  The passions that can be aroused in a dispute between the shareholders in a business are as intense as those which my colleagues in the family law sphere are used to dealing with.  How to avoid these passions killing the golden goose in boardroom disputes is a perennial problem.

Read more »

All is not well in the boardroom of UK Plc

The UK cabinet is the most powerful boardroom in the UK.  Like all boardrooms it can be be the venue for bitter infighting as the recent attempted coup by Messrs Hoon and Hewitt neatly illustrates.

Read more »

A good old fashioned pub brawl

Mitchells & Butlers (”M&B”) owner of pub chain All Bar One has been airing its dirty linen in public.  Rebel shareholders at the company have seen their representatives kicked off the board in what has all the hallmarks of a classic boardroom dispute.

Read more »

Paying the price for fighting for shareholders rights

Lawyers involved in fighting for shareholders rights are not normally thought to be in a dangerous profession.  That is unless you are a lawyer in Russia.

The death has been announced (see Daily Telegraph article) of Sergei Magnitsky, 37 year old father of two and a lawyer in the firm of Firestone Duncan in Moscow who were representing Hermitage Capital Management.

Read more »

Shareholder Rights Directive

The EU Shareholder Rights Directive is a grand title but on close analysis it does not add much to the armoury of a UK shareholder aggrieved with the company in which they hold shares.

Consequently it has been implemented in the UK (via the Companies (Shareholders’ Rights) Regulations 2009 with relatively little fanfare.  The main reason for the lack of excitement is that the regulations generally only apply to “traded companies” and they only marginally increase shareholders rights or powers overall.

Read more »

Handbook on International Commercial Arbitration

Shareholders disputes and boardroom disputes often have an international element.  Where arbitration is utilised to resolve such disputes there are many traps for the unwary.  In this respect I have no hesitation in recommending the recent Handbook on International Commercial Arbitration written by my fellow partner in Cripps Harries Hall LLP, Peter Ashford.

The book is a practical text aimed at those involved in international arbitration.  It is a handy addition to any commercial litigator’s library providing authoritative but easily digested guidance on all aspects of international commercial arbitration.

Hiding made easier for dodgy directors

One aspect of the Companies Act 2006 which has not inspired much comment is the new rules about disclosure of directors residential addresses.

These are contained in sections 240 -246 of the Companies Act 2006.  These provisions came into force on 1 October 2009, together with most of the remaining provisions of the Companies Act 2006 that had not yet been brought into effect.  For an article on all of the key changes coming in to force in October 2009 please click on this link.

The effect of ss 240 - 246 of the Companies Act 2006 will be to make life more difficult for those in the business of pursuing dodgy directors. 

Read more »

Shareholders get their man in the end

A rare example of shareholders anger over excessive remuneration bearing fruit has been seen with the giant oil company Shell.

Bonuses awarded to Shell executives this year were widely considered to be excessive and the remuneration committee came in for intense criticism.  The committee felt it proper to award significant bonuses even though performance targets had not been met.

The usual symbolic exercise of shareholder rights took place (see previous posts on this subject) and the pay settlement was voted down at general meeting.  Now it is reported in The Times that two members of the remuneration committee, including the chairman Sir Peter Job, will step down.  It looks like the shareholders did get their scalps after all.

One other interesting thing about the reporting of this event is that Shell itself seems to have come to the view that after 9 years as a non-executive director (NED) Sir Peter could no longer be considered to be truly independent.  This reflects other discussions currently being had about the role of NEDs and suggests that the days of a NED having a long term sinecure are now well and truly gone.

FSA gives green light to shareholders acting in concert

A noteworthy addendum to Sir David Walker’s review of corporate governance is the open letter from the FSA to the Chairman of the ISC dated 19 August 2009.

This letter flags up the FSA’s support for more active shareholder engagement in disputes with boardrooms, with a view to promoting good corporate governance.  This encouragement of shareholder activism at this level may be an important development.

Read more »