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PM Capital

PRI reporting framework 2017

You are in Direct - Listed Equity Active Ownership » Engagement » Process » Process for engagements run internally

Process for engagements run internally

LEA 03. Process for identifying and prioritising engagement activities

New selection options have been added to this indicator. Please review your prefilled responses carefully.

03.1. Indicate whether your organisation has a formal process for identifying and prioritising engagement activities carried out by internal staff.

03.2. Describe the criteria used to identify and prioritise engagement activities carried out by internal staff.

other description

          Company Level - Engagement by Portfolio Managers who is in charge of the company analysis.

03.3. Additional information. [Optional]

PM CAPITAL has a reputation for encouraging good ESG practices and we regularly engage the management of the companies that we own around the continuous improvement of ESG practices.
Failing a suitable outcome, we are happy to approach the boards of listed companies directly, as well as taking our case to the press.

We will generally oppose proposals where we see:

  • The election of inappropriate directors, particularly where there is not a majority of independent directors or where there has been excessive turnover of board / senior executives
  • Excessive management remuneration arrangements, or a lack of alignment between executive incentive structures and a company‚Äôs operating performance
  • The appointment of auditors who are not independent.
  • Agitating for change in this way helps us to unlock the inherent value in a company in order to achieve a better outcome for our investors.

One example involved Austar which, as part of their Employee Share Plan, provided $43 million in interest-free loans to 13 senior managers and an $8.2 million interest-free loan to their chief executive.

As a minority shareholder, we were unable to block the employee share plan and so raised our concerns with management. We then voiced our views in the press to ensure that the new Employee Share Plan had more appropriate incentives in place.

LEA 04. Objectives for engagement activities (Not Completed)