Documents: 11/12/2002 - Alex Henney's Comments On The Board's Memorandum And Articles Review 11 December '02 - Alex
Henney's Comments On The Board's Memorandum And Articles Review
The board's Review is trivial
(see notes below). With the exception of increasing the number of people to
nominate a person for the Board to 5, the proposed changes:-
- ignored the wishes expressed
by 16,179 petitioners who asked Treves to change the governance of the Society
by changing the rules for calling an EGM and allowing members to propose a
resolution at a general meeting:-
|
From |
To |
To call
a meeting |
10% of
members (about 30,000) |
1,000 |
To propose
a resolution |
5% of members
(about 15,000) |
500 |
- entirely ignored the
proposed changes made by EMAG aimed at:-
- ensuring the proper
provision of financial information to the standards indicated by the Financial
Services Agency and the Sandler Review of Medium and Long Term Retail
Savings in the UK
- allowing members
more democratic control over the Board by calling EGMs as per the petition
mentioned above
- ensuring the right
of members to have full and accurate (i.e. non-spin and misleading) answers
to questions at a general meeting
- altering the voting
arrangement to simplify it and to prevent the Chairman/incumbent board
casting non-mandated votes that allows them effectively to control appointments
to the Board so that they can operate as a self perpetuation oligarchy
- providing full financial
information to members on the valuation - and basis of valuation - of
their policies. As I found out, the Society's response to requests for
information on surrender and maturity values is:-
"We do not
provide details of how we arrive at surrender values. It is not a
service we offer".
- limiting the number
of directorships held by a director. The current chairman is chairman
of two other commercial undertakings and non-executive director of 20
companies, chairman of the London Business School, and is involved with
various charitable organisations
THE BOARD IS ONCE AGAIN
DENYING MEMBERS OF THE SOCIETY OF THEIR DEMOCRATIC RIGHTS AND THEIR RIGHTS TO
INFORMATION ABOUT THE SOCIETY'S CIRCUMSTANCES AND THEIR INDIVIDUAL CIRCUMSTANCES.
Detailed comments on
the Board's Review
The full set of Equitable Life's proposed changes is available on the Society's
website in a PDF file at:
http://www.equitable.co.uk/et/market.nsf/web+pages/CorporateHome
under Memorandum and Articles
of Association section, "consultation document". (N.B. we are not
allowed to link into the Equitable website)
Article
No. |
Summary
(Our opinion in bold) |
1 |
Proposes
updating the English of the Articles. Agree. |
5 |
Proposes that the
AGM can be held in June as well as in April or May. Disagree. May
is quite late because the information in the Annual Report & Accounts
is by then well out of date. June is worse.
|
24(1) and
(2) |
Administrative changes
to the voting arrangements. Agree.
|
26(3) and 27
|
Abandoning the requirement
for a proxy at a general meeting not to be a member is presumably linked
to the proposal that directors are not members of the Society. We agree.
The statement that "the form of proxy specified in the Articles
should be updated to reflect modern practice is ambiguous" - what
is "modern practice"?
|
26
|
Proxies should be
entitled at general meetings to speak and to vote on a show of hand. Agree.
|
25(4) |
Forms of proxy can
be returned to an address specified by the Board. Agree.
|
31 |
The maximum number
of directors should be reduced to 12, and the minimum to 6. Agree.
|
32
|
The provision that
"no person shall be qualified to be or become a Director unless he
is for the time being a member of the Society" should be removed.
As the Society will soon be a society for annuitants we have changed
our view and now agree.
|
43, 44, 46, 48, 65,
39 and 58(1)
|
Require
a "Special Board Meeting" to transact certain items of business.
References to "Special" Board Meetings should be removed and all
business should be conducted at 'ordinary' Board meetings. Not entirely
agree. The purpose of the Special Board Meeting is to decide on bonus
declarations, and the "Special" nature emphasises the importance
of the decision and the responsibility of the Board for the bonus decision.
The proposed change may be an attempt for devolution and side-stepping of
responsibility onto the Appointed Actuary. |
41
|
requires someone standing
as a Director to have 50 people nominating him. Agree.
|
46 and 47
|
It should
be stated explicitly in the Articles that the Board may appoint officers,
employees and professional advisers; and may confer such powers upon such
officers, employees and professional advisers as it thinks fit (unless the
powers are specifically required by the Articles to be exercised by the
Board). Agree. |
65 |
This regulation
should be amended to reflect that, in accordance with Financial Services
Authority regulations, valuations are conducted by the Appointed Actuary.
It should also require that such valuations be conducted annually (the requirement
in the current regulation is at least once in every three years). Agree. |
Other proposals cover:-
- the possibility of overflow
rooms for general meetings
- representation at general
meetings of members who are patients under mental health legislation, or subject
to an order of a court to protect people unable to manage their own affairs.
(There is no current regulation relating to this topic)
- the appointment of a
director is subject to FSA approval
- any director over 70
should be subject to re-election at each AGM
- Board meetings can be
held over the telephone or by video link Agree
|