THE Australian Shareholders Association’s battle against what it sees as inappropriate options packages is not just reserved for monster corporations such as Southcorp.
The ASA is incensed by Southcorp’s decision to extend the exercise date for 2,000,000 share options granted to the dumped former chief, Keith Lambert.
In WA the shareholders’ action group is known to have its sights set on a couple of players, including mining services company Macmahon Holdings, which had a good news announcement regarding new contracts worth $95 million spoiled by an ASA letter circulated to shareholders that condemned options packages for two non-executive directors – former BHP Minerals chief Dick Carter and former Rio Tinto Australia head Barry Cusack.
The ASA is opposed to options being included in the remuneration of non-executive directors, citing them as a threat to good governance. And that includes the 1,000,000 options proposed for each of the two Macmahon directors, even though the hurdle rates, exercise prices and general restrictions are otherwise by the book.
“Shareholders should be asking why Macmahons is not adhering to well-publicised guidelines formulated by independent bodies in the interest of best practice,” ASA WA branch chairman Anne Pryor told shareholders.
Macmahon chairman David Humann defended the options as being necessary to attract the right type of people to the board and reward them for the risk they took – particularly at Macmahon, which had been struggling at the time of the appointments.
Mr Humann said Macmahon had been lucky to get two directors of the calibre of Mr Carter and Mr Cusack.
He said he regretted the decision not to grant the options last year when the use of the securities was receiving intense scrutiny.
“We are going ahead with it,” Mr Humann said.
“We did not go ahead last year when we should have in the face of controversy.
“What is all the fuss about boards doing a good job, we are not being excessive.”
Macmahon’s directors will have the opportunity to discuss this with shareholders at Monday’s meeting.
Governor muscles up
SPEAKING of fusses, there was a big one last week when Arnold Schwarzenegger won the governorship of the US state of California.
While I don’t disagree that some of the news about Mr Schwarzenegger’s courtship habits raised serious questions about his character, they came late in the day.
The early criticism pointed at his career as an actor, drawing comparisons with ex-US president Ronald Reagan.
Sure, we all agree that Hollywood is a little bit like toy town but where is it assumed that actors can’t be politicians or lack the ability to govern?
Democracy draws from all parts of society for its leaders. With the movie industry comprising a major part of the Californian economy it would be surprising if it didn’t habour politically active people.
Why should actors be any less capable of governing than teachers, unionists or lawyers?
Are we worried that actors will be better at feigning emotions, covering up mistakes or convincing those otherwise unable to be convinced? In some ways, isn’t that what politicians already do?
Many actors go on to direct and produce movies with budgets that seem similar in size to some Australian States. They are not all stupid.
And why do the same people who ridicule actors for their political ambitions keep shoving these ‘personalities’ and their private lives in our faces as if they matter?
There might be some doubt about Mr Schwarzenegger’s capacity to rule California but it has got very little to do with his chosen profession.
AN alert reader pointed out an interesting error in the statistical information we run in our For The Record section as the WA Scorecard.
A few weeks ago we published a piece about WA’s population reaching 1.95 million in March after annual growth of about 1.5 per cent.
Unfortunately, this figure was rounded up to 2 million in the scorecard – an understandable mistake when you look at the amount of data contained in that table.
While the alert reader was expressing mock surprise at WA reaching this milestone, I have to say I was surprised at how close we really are.
By my calculations, if growth remains a steady 1.5 per cent, we’ll crack the 2,000,000 mark before this time next year.
For population growth fans like myself this is good news and quite a remarkable achievement for the State.
And by the way, Australia has probably already reached 20 million people – if growth of 1.3 per cent for the March quarter is extrapolated against the then population of 19.875 million.
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