On 28 March 2014, Company Directors lodged a submission with ASX Limited in response to the Proposed Governance-Related Listing Rule Amendments – Supplementary Consultation.
Key comments made in our submission included:
- Broadly speaking, we support the changes proposed under the Supplementary Consultation. In particular, we strongly support the move away from requiring the disclosure of on-market purchases under an employee incentive scheme on an ongoing basis to only requiring this disclosure to be made as a one-off annual disclosure in the company’s Annual Report covering all purchases made during the reporting period. We also support the proposed removal of the requirement to include a “chairman’s box” in proxy forms.
- The types of payments and other benefits that need to be disclosed in the notice of meeting under the third dot-point of the redrafted Listing Rule 10.17 should be clarified. We do not think that it should be drafted on such broad terms that could potentially capture unintended payments and should instead be limited to the disclosure securities that have been issued with the shareholder approval under Listing Rule 10.11 or 10.14 to the entity’s non-executive directors over and above their directors’ fees.
- Payments made to a non-executive director to participate in committees that are set up on an ad hoc basis to deal with a specific issue should be properly categorised as “special exertion” fees and excluded from the directors’ fee cap approved under Listing Rule 10.17.
- We do not think it is appropriate for the definition of “associate” under Listing Rule 19.12 to “deem” a related party of a director or officer to be their associate. While our preference would be for this to be removed from the definition, the proposed approach under the Supplementary Consultation to allow a director or officer to establish that a particular related party is in fact not an associate by providing a statutory declaration to that effect provides a practical solution for directors.
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