M&S readies for investor protest vote
Four large investors in Marks & Spencers are planning to vote against the retailer’s annual report and accounts at its annual meeting next week over concerns about Sir Stuart Rose’s dual role as executive chairman and chief executive.
Three pension schemes – The Universities Superannuation Scheme, Railpen and APG, and the Co-operative Insurance Society, who together own nearly 2 per cent of M&S – are worried that Rose’s move may set a “worrying precedent” for British companies.
M&S is so concerned about shareholders voting against its plan that it has held several meetings with investors in a bid to calm their fears.
However, Daniel Summerfield, cohead of responsible investment for the Universities Superannuation Scheme, said M&S failed to adequately justify Rose’s dual role and it will vote against the move.
“USS is taking this action to send a vote of no-confidence in the board of directors. We believe that there are significant governance and operational risks inherent in the new structure which have arisen as a result of the board failing to manage an effective succession process.”
Pat Wade, corporate governance manager at Co-operative Investments said he was concerned by the board’s lack of succession.
“There are risks inherent in the concentration of power in one individual, even of Rose’s stature. Research has linked poor governance with lower average share price returns and profitability in the long run,” he added.
M&S shares slid another 1.6 per cent yesterday to close at 236p.
