SBC News Tabcorp governance faces investor pressure with regards to executive pay & merger voting process

Tabcorp governance faces investor pressure with regards to executive pay & merger voting process

Tabcorp

Australian business news sources have reported that a number of Tabcorp investors have expressed disappointment with regards to executive compensation at the firm’s ‘annual general meeting’ (AGM).

Although the majority of Tabcorp investors’ voted in favour of increasing CEO David Attenborough’s pay package, it has been reported that 22% of votes cast were against the motion, falling just short of the 25% benchmark needed to suspend the increased payment.

Concerned investors pointed to Tabcorp’s 50% profit decline in 2016, which has seen the gambling operator severely hit by its costly ongoing legal battle against anti-money laundering charges made by the Australian Transaction Reports and Analysis Centre (AUSTRAC). Presenting Tabcorp full-year 2016 results this August, Attenborough told investors that 2016 had seen Volatile business conditions for Tabcorp operations.

Attenborough’s pay package is set to rise from AUS $2.7 million to AUS $3.1 million. The Australian Shareholders’ Association (ASA) and several corporate governance advisers opposed Tabcorp’s planned increases in executive pay.

ASA further requests Tabcorp governance to give its shareholders a vote on the firms planned AUS $11.3 billion merger with rival, Tatts Group, a motion which was dismissed by Tabcorp Chairman Paula Dwyer at the AGM.

Under Australian exchange laws, corporations do not require shareholder approval if they are conducting a reverse takeover. The merger of Tabcorp-Tatts will therefore solely require the final approval of the Australian Competition & Consumer Commission.

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