A majority of Rio Tinto shareholders have voted against adoption of the company’s remuneration report while a large minority opposed the re-election of director Megan Clark.
A majority of Rio Tinto shareholders have voted against adoption of the company’s remuneration report while a large minority opposed the re-election of director Megan Clark.
The voting results were released late on Thursday after the conclusion of the miner’s annual general meeting in Perth.
The remuneration report copped a 60.8 per cent Against vote. This constitutes a ‘first strike’ but is simply an advisory vote.
There was a 26 per cent vote against the re-election of Ms Clark, who chair’s the board’s sustainability committee and therefore was seen by critics to have extra responsibility for the Juukan Gorge issue.
Chairman Simon Thompson and director Sam Laidlaw, who chairs the remuneration committee, attracted much smaller protest votes, with about 5 per cent of votes cast against their re-election.
The big protest vote against the remuneration report was in line with advice from several advisory groups.
Proxy advisory firms ISS Governance, Glass Lewis and PIRC along with the Australian Council of Superannuation Investors and the Australian Shareholders’ Association all recommended voting against the remuneration report.
In a statement, Rio’s board said it understands that the protest vote related to the lucrative long-term incentives retained by three former executives, including CEO J-S Jacques, who lost their jobs over the Juukan Gorge issue.
The board said it has already engaged extensively with shareholders and proxy advisers and used that to help formulate a new remuneration policy.
“The new remuneration policy strengthens the board’s ability to exercise discretion through the revised malus provisions in relation to events having a major impact on the group’s social licence to operate or reputation,” Rio said.
The new policy also introduces environmental, social and governance (ESG) metrics.
Regarding Ms Clark, the board has concluded she should continue as a director, as she provides continuity and is the only director with mining experience.
As chair of the sustainability committee, she is leading the board’s oversight of new Aboriginal heritage policies.
And as one of the few board members who is an Australian resident, she is also playing a lead role in meetings with traditional owners in the Pilbara.
Speaking at today’s AGM, Mr Thompson said the board was looking to bring more resident Australians and people with mining expertise onto its board of directors.
