Investor group joins DJs revolt
While other shareholders are expected to use the vote as an opportunity to protest about recent controversies at David Jones - share acquisitions by two directors days before price-sensitive announcements by the company, as well as the mysterious and sudden resignation of chief executive Paul Zahra - the ASA said there were legitimate reasons for rejecting the report in its own right.
Given poor results to date and the meagre prospects in sales, margins and multi-channelling, the ASA said the short-term incentives (STI) offered to the executive team were too generous.
"Mr Zahra was awarded 88 per cent of his STI for 2012-13, which seems excessive," the ASA report said.
A no vote on a company's remuneration report of more than 25 per cent at two consecutive annual meetings triggers a resolution to spill the entire board.
Frequently Asked Questions about this Article…
The Australian Shareholders Association (ASA) has joined a shareholder revolt against David Jones, expressing concerns over the company's remuneration report. They believe the short-term incentives offered to the executive team are too generous given the company's poor results and meager prospects.
Shareholders are protesting against David Jones due to recent controversies, including share acquisitions by two directors before price-sensitive announcements and the sudden resignation of CEO Paul Zahra. Additionally, there are concerns about the generous short-term incentives given to executives despite poor company performance.
If more than 25% of shareholders vote against David Jones' remuneration report at two consecutive annual meetings, it could trigger a resolution to spill the entire board, leading to significant changes in the company's leadership.
Paul Zahra was awarded 88% of his short-term incentive (STI) for the 2012-13 period, which the Australian Shareholders Association considers excessive given the company's performance.
The concerns regarding David Jones' executive incentives revolve around the generous short-term incentives provided to the executive team, which are seen as excessive in light of the company's poor sales, margins, and multi-channeling prospects.
A 'first strike' occurs when more than 25% of shareholders vote against a company's remuneration report at an annual meeting. This is significant as it signals shareholder dissatisfaction and can lead to further actions if repeated.
Recent controversies affecting David Jones include share acquisitions by two directors shortly before price-sensitive announcements and the sudden resignation of CEO Paul Zahra, which have contributed to shareholder unrest.
The potential outcomes of a shareholder revolt at David Jones include a 'first strike' against the remuneration report, which could lead to a board spill if repeated, and increased pressure on the company to address shareholder concerns and improve performance.
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