ASIC clarifies voting on remuneration reports

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09 Aug 2011

The Australian Securities and Investments Commission (ASIC) has released an Information Sheet on the new provisions in the Corporations Act 2001 dealing with remuneration report resolutions.

The new rules govern when chairpersons at annual general meetings (AGM) can cast proxies on remuneration report resolutions. Under the new rules introduced by the Corporations Amendment (Improving Accountability on Director and Executive Remuneration) Act 2011, there is some uncertainty about the circumstances in which a shareholder can appoint a chairperson who is member of the company's key management personnel (which includes a director) to vote as their proxy in a non-binding vote to approve the remuneration report.

During 2011, the government proposes to amend the provisions to make it clear that chairpersons are permitted to vote undirected proxies on remuneration report resolutions (see Government press release, link to Australian Treasury website). Until the rules are amended to give effect to the government's intention, ASIC's information sheet provides options for companies to consider when complying with the current rules.

Click for ASIC Information Sheet 144 Annual general meetings: Voting on the remuneration report resolution (link to ASIC website).

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