iNVEZZ.com, Monday, May 19: Glencore Xstrata (LON:GLEN) is expected to face a backlash from shareholders at its annual general meeting tomorrow, as the Switzerland-based commodities giant remains the only FTSE 100-listed company with an all-male board.
A number of major institutional investors, including Aviva Investors, are expected to oppose Glencore’s annual report and accounts, the Financial Times yesterday reported. The UK fund house, which has a 0.7 percent stake in the company, could also take a stand against the election of Anthony Hayward as permanent chairman (Glencore share price climbs as company announces chairman appointment), the newspaper noted.
Aviva’s stance has been backed by the Local Authority Pension Fund Forum (LAPFF), which represents 60 UK public sector pension funds. Earlier this month, the LAPFF advised its members, which collectively account for more than one percent of Glencore’s stock, to vote against the election of Hayward, who led the company’s nomination committee until February.
The LAPFF said it was disappointed that Glencore had not set targets to improve female board representation, failing to meet standards set by 2011’s government-commissioned report by former banker and Trade Minister Lord Davies.
“Anthony Hayward, as chair of the nomination committee over the last year and board chair, must bear some responsibility for this lack of progress,” LAPFF chairman Kieran Quinn said as quoted by the FT.
Robert Talbut, chief investment officer at Royal London Asset Management (RLAM), which has a 0.2 percent stake in Glencore, indicated RLAM would also oppose resolutions at the mining company’s meeting.
The Qatari sovereign wealth fund, Glencore’s biggest shareholder with an 8.7 percent stake, Norway’s sovereign wealth fund, which has a 2.1 percent share, BlackRock, with a 5.7 percent holding, and Legal & General Investment Management, which has a 0.3 percent stake, all have declined to comment on whether the mining group’s board structure would affect their voting decisions tomorrow.
Glencore, which began to search for a female board candidate in February 2012, said in a statement: “Glencore values and promotes diversity across its business. The appointment of a female board member is a significant consideration and our nominations committee is working to identify appropriate female candidates.”
The commodities major will also face a fresh grilling over its accounting practices, according to The Telegraph. Shareholder groups have urged investors to vote against a resolution put forward by Glencore to ditch the requirement to publish accounts in line with UK rules in favour of less transparent Swiss rules.
In the resolution, which is part of a new series of Articles of Association, the miner has asked shareholders to approve the “removal of the requirement for the Company to produce stand alone accounts in accordance with International Financial Reporting Standards (IFRS) as these are not required by Swiss law”.
Glencore share price
Glencore closed Friday’s trading session marginally higher at 325.62p. According to AnalystRatingNetwork data, four equity analysts rate the FTSE 100-listed commodities giant as a ‘sell’, five give it a ‘hold’ rating and 14 are calling it a ‘buy’. The shares have a consensus rating of ‘hold’ and an average price target of 361.74p.
As of 08:32 BST, buy Glencore shares at 327.85p.
As of 08:32 BST, sell Glencore shares at 327.70p.