REM report voted down
At its inaugural annual meeting, the real estate investment trust faced feisty investors who voted down the report, with 46 per cent against.
As part of the remuneration report was a proposed issue of "special one-off award of performance rights" for chief executive Anthony Mellowes and former chief financial officer Kerry Shambly.
If all vested the maximum they could receive would be $400,000 for Mr Mellowes and $55,000 for Ms Shambly, who left the group after eight months.
This raised the ire of corporate governance bodies such as ISS.
In the SCA annual report, it says these rights would be vested in two tranches.
But the report added: "In the event that unit holder approval is not granted [at the AGM] it is expected that the monetary equivalent will be paid."
The governance group said that effectively amounted to a choice between a cash and an equity incentive, rather than a decision on whether to approve an incentive offer.
Frequently Asked Questions about this Article…
SCA Property is a real estate investment trust that is an offshoot of Woolworths. It focuses on managing and investing in retail properties.
SCA Property is a real estate investment trust that is an offshoot of Woolworths. It focuses on managing and investing in retail properties.
SCA Property reported a maiden loss of $4.4 million due to costs associated with its float, which is a common occurrence for companies during their initial public offerings.
SCA Property reported a maiden loss of $4.4 million due to costs associated with its float, which is a common occurrence for companies in their initial stages of public trading.
At SCA Property's inaugural annual meeting, 46% of investors voted against the remuneration report, resulting in a first strike against it.
At SCA Property's inaugural annual meeting, 46% of investors voted against the remuneration report, resulting in a first strike against it.
The proposed remuneration report included a 'special one-off award of performance rights' for the chief executive, Anthony Mellowes, and the former chief financial officer, Kerry Shambly.
The remuneration report included a proposed issue of 'special one-off award of performance rights' for CEO Anthony Mellowes and former CFO Kerry Shambly, with potential maximum values of $400,000 and $55,000 respectively.
If all performance rights vested, Anthony Mellowes could receive up to $400,000, while Kerry Shambly, who left the group after eight months, could receive up to $55,000.
Corporate governance bodies such as ISS raised concerns because the remuneration report effectively offered a choice between a cash and an equity incentive, rather than a straightforward decision on whether to approve an incentive offer.
Corporate governance bodies like ISS raised concerns because the remuneration report effectively offered a choice between a cash and an equity incentive, rather than a straightforward decision on whether to approve an incentive offer.
If unit holder approval is not granted at the AGM, the monetary equivalent of the performance rights is expected to be paid to the executives.
If unit holder approval is not granted at the AGM, it is expected that the monetary equivalent of the performance rights will be paid to the executives.
The performance rights for SCA Property's executives are structured to vest in two tranches, providing a phased approach to their potential payout.
A 'first strike' against a remuneration report indicates significant shareholder dissatisfaction. If a second strike occurs in the following year, it could lead to a spill of the board.
The remuneration report's structure and the resulting first strike have raised concerns among corporate governance bodies, potentially impacting the perception of SCA Property's governance practices.
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