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Governance

Shareholder resolutions in U.K. rise 25% in 2018

The number of shareholder resolutions in the U.K. increased 25% year-to-date July 31 compared to the same period in 2017, according to a public register by the Investment Association, which the U.K. money management body compiled for the second time.

Shareholder dissent cases increased to 237, landing 120 companies on the register compared to 110 companies registered in same period in 2017.

FTSE 100 companies' resolutions increased to 28 from 21 in 2017; however, FTSE 250 resolutions were down to 95 from 96 for the year-earlier period.

In 2018, 29 companies reappeared on IA's public register due to the same resolution as last year, the association said.

The number of total resolutions resulting from opposition to director re-election increased to 80 from 38 in 2017. FTSE 250 companies accounted for the majority of this increase, with 37 resolutions, up from 18 a year earlier.

While executive pay resolutions declined overall, with remuneration-related resolutions dropping to 61 in 2018 from 68 in 2017, shareholder dissent regarding compensation among FTSE 100 companies doubled year-over-year to 18 cases.

"Shareholders have shown their teeth this year over FTSE 250 director re-election. They are using their votes to hold individual directors to account for decisions they made on issues such as executive pay and board diversity, as well as concerns that individual directors do not have the bandwidth to fulfill their roles as they spread themselves too thinly on too many boards," Investment Association CEO Chris Cummings said in a news release.

Mr. Cummings added, "Shareholders clearly remain unimpressed with the approach to pay last year and are frustrated the message is not getting through to some boardrooms."