Individual directors remuneration for 2016 disclosure
s.202B of Corporations Act allows us to force CPA Australia to disclose individual directors remuneration for the 2016 year.
It needs to be audited and then sent to all members.
Given their refusal to do so voluntarily, and given the scandalous nature of the remuneration levels paid to the Key Management Personnel (which includes the board) in 2016.
It being $5,508,000 for 15 people (3 senior executives - Malley, Awty and Hughes, and 12 directors).
They have told us the directors have not received the maximum (approx. $1,700,000) under the constitution, so what exactly did they receive.
Because the difference between what the 12 directors were paid and the $5,508,000 will reveal exactly the scandalous amount the 3 senior executives were paid.
At a minimum that is $3,808,000. You’ll have to pick yourself up off the floor after that one I suggest.
And what have the CPAA leadership said about this to us said about all this
Memo to members 2nd April 2017 (www.cpamembers.org website for the full memo).
What gall and bravado for them to call this one figure total ‘clear disclosure’ and holding ‘no secrets’.“...the annual cost of which is clearly disclosed in each year’s annual report in accordance with applicable standards and subject to scrutiny at each Annual General Meeting.
There simply are no secrets in relation to the total quantum of cost…”
C’mon don't swear.
Lets act and force them to provide full disclosure so there are no secrets.
Memo to members 16th April 2017 (www.cpamembers.org website for the full memo).
Thats not just gall and bravado, that's just plain arrogance and a one finger salute to members saying ‘if we can do it then we shall, and up yours’."Board remuneration and chief executive remuneration is in line with the market, based on regular advice obtained from independent remuneration consultants. Additionally, the chief executive remuneration is also recommended by the Nomination and Remuneration Committee and approved by the Board. Similarly, staff remuneration is also regularly benchmarked by external remuneration specialists.
C’mon don't swear.
Lets act and force them to provide full disclosure so they have nowhere to hide from their shame.
Remember 99% of other public companies (listed) provide full disclosure on directors and senior managers, so there is not legitimate reason why we shouldn’t also.
What do we need to do?
We just need to lodge a s.202B request signed by 100 members.
I suggest we do so asap, and have attached the form for your signature and return to me asap so I can lodge with them.
So, if you think this is a good thing to do (and I certainly do), can you sign the attached request and send back to me asap.
What should the CPA Australia board do at the Singapore AGM?
Just for a moment place yourself in their shoes and think 'what would I do if I were they'?
Here is what I would do
1. Fully disclose the directors remuneration (individually) because it is about to be forced upon them anyway so I would think let's take the wind out of this guys email complaints.
2. Fully disclose the senior executives remuneration (individually) because that will really show we are not hiding anything and will knock this guys complaints for six.
3. Resign as a director, along with all the others, in acknowledgement that we need to take the blame and responsibility for this scandal which is about to hit the media.
The directors might not be having celebratory glasses of champagne on their flight home but they will have the deep satisfaction in their hearts that only doing the right thing provides.
Well that was my flight of fancy. I feel much better for it.
Much better than a business class return flight to Singapore next week with a bunch of CPA Australia staff and leaders.
At least my flight was fully paid for by me, and I wasn’t ‘milking the cow’.
Why full disclosure of remuneration is the way to go for CPA Australia
This is from an article titled MONKEYS, GOLDEN HANDSHAKES AND CLERP9: A REVIEW OF THE RECENTLY PASSED REFORMS TO DIRECTORS’ REMUNERATION"The arguments against enhanced disclosure are weak.
While disclosure may be costly, a lack of it can lead to even greater costs through excessive self-dealing – hence Brandeis’s famous statement
that “sunlight is the best disinfectant”.53 Remuneration disclosure can also lead to best practice as shareholders may demand that their company
adopt the remuneration policies of other companies. In respect of any comparative disadvantages vis-à-vis private companies, this may simply be
a small trade-off for the numerous advantages listing can bring.
At any rate, Ian Ramsay notes that many of Australia’s largest companies already comply at no apparent disadvantage with increased transparency
in other jurisdictions.54
There is also no evidence that “ratcheting up” will occur, as this has not happened with other publicly disclosed wages55 and there is evidence
to suggest that directors have a fair idea about each other’s wages anyway.56
For these reasons, the weight of expert opinion is firmly and justifiably in favour of enhanced disclosure of remuneration.57”
by Luke Armold published in (2004) 22 C&SLJ 545
If anyone cant obtain it and wants a copy of the article let me know and I’ll send it through. It’s pretty good.
Given that CPA Australia is one of the few remainign public companies in Australia that does not provide full disclosure of remuneration you would have to say we reallly have dropped the ball.
Sign and send back to me asap the attached s.202B request if you agree.
I have attached the CCH online explanatory note which pretty much just repeats the actual wording of the section in the Act.
Brett Stevenson CPA BComm MDiv