PIRC has published a new edition of its UK Shareholder Voting Guidelines which replace the version published in April 2015.

Changes include the following:

  • PIRC will not support authorities for the disapplication of pre-emption rights up to an amount equal to 10% of the company’s issued ordinary share capital unless the board has made a clear, cogent and compelling case why the 10% level is appropriate for the company.
  • PIRC recommends voting against future share buyback authorities unless the board has made a clear, cogent and compelling case demonstrating how the authority benefits long-term shareholders and that the directors are not conflicted in recommending the authority.
  • PIRC recommends abstaining where non-audit fees paid to auditors are between 25% and 50% of audit fees and opposing if non-audit fees exceed 50% of audit fees for either the year under review or the previous three years.
  • PIRC supports the Davies Review recommendation that 33% of board positions in FTSE 350 companies be held by women by 2020 and expects companies to report on targets and attempts to address gender inequality if PIRC deems there to be evidence of gender disparity in the workforce and the gender balance on the board.
  • Whilst noting that remuneration committee members should not be executive directors of other UK listed companies, in 2016 PIRC will abstain on the election of such directors who sit on the remuneration committee.
  • PIRC considers the provision of remuneration consultancy by audit firms to be wholly unacceptable.

The full content of the revised guidelines is only available by purchase from PIRC.