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 an institutional shareholder revolt against David Jones, aiming to deliver a first strike against the company's remuneration report at the upcoming shareholder meeting.
Shareholders are protesting due to recent controversies, including share acquisitions by directors before price-sensitive announcements and the sudden resignation of CEO Paul Zahra. Additionally, there are concerns about the company's poor financial results and generous executive incentives.
The concerns revolve around the generous short-term incentives offered to the executive team despite poor financial results and prospects. For instance, former CEO Paul Zahra received 88% of his short-term incentives for 2012-13, which the ASA considers excessive.
If a company's remuneration report receives a no vote of more than 25% at two consecutive annual meetings, it triggers a resolution to spill the entire board.
Paul Zahra was the CEO of David Jones who recently resigned under mysterious circumstances, contributing to the shareholder unrest.
David Jones is facing challenges such as poor sales results, low margins, and limited prospects in multi-channelling, which have raised concerns among shareholders.
The shareholder revolt highlights the importance of corporate governance and accountability, which can affect the company's stock performance and, consequently, the investments of everyday investors.
A first strike occurs when more than 25% of shareholders vote against a company's remuneration report at an annual meeting, signaling dissatisfaction with executive pay practices.
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