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Proxy Voting Policies
On most issues, E.I.M. will cast votes in accordance
with the recommendations of directors because the reputation,
experience and competence of management and directors would have
been considered during the Manager’s investment selection process.
Voting against management on a substantive issue would signal a loss
of confidence that would necessitate a review of the investment
holding. Companies with which E.I.M. disagrees on material issues
of governance are unlikely to be included in the focus list of
stocks from which its investments will be drawn.
From time to time,
E.I.M. will develop guidelines on issues likely to be the subject of
company resolutions. As those guidelines are developed, they will
be incorporated into this policy statement.
E.I.M. will not support
propositions put before shareholders where it determines that they
would detract in any material sense from the investment merits of
the company.
E.I.M.
will generally review each resolution put to shareholders on a
case-by-case basis guided by the following principles:
-
the
desirability of separating the roles of Chairman and CEO,
-
the
need for sufficient independent directors to serve as a majority
on Audit and Remuneration Committees,
-
executive compensation schemes structured to provide incentives
to improve upon current performance (and not reward historical
performance),
-
executive compensation to be in line with compensation within
comparable companies taking account of size, profitability and
economic return,
-
re-election of directors where financial performance has been
acceptable,
-
the
role of auditors to be limited to the audit engagement and
closely related activities, and,
-
support
for the ASX Corporate Governance Council’s Principles of Good
Corporate Governance and Best Practice Recommendations.
In applying these principles, E.I.M. recognises that it
might not be possible for some companies to meet these standards
(e.g. the need to have separate audit and remuneration committees)
when they are at an early stage in their development with limited
financial resources. However, other practices will be needed to
compensate until circumstances change.
E.I.M. will review proposed changes to capital structure
or proposed mergers and acquisitions on a case-by-case basis. E.I.M.
will not support changes which, according to its valuation analysis,
fail to add value for shareholders.
E.I.M. will not seek to take an active role in changing
company social and corporate policies, including environmental
policies.
E.I.M. is primarily concerned about the financial
interests of its clients, the financial performance of the companies
in which it invests on behalf of its clients and their investment
returns. It incorporates a range of social and environmental
factors into its investment decision making generally eliminating
companies from its list of potential investments if the company
fails to meet environmental or social standards where it regards
these as relevant to investment outcomes.
Proxy voting recommendations will normally be made by
the E.I.M. Investment Committee with advice, as required, from Colin
Jackson, a member of the E.I.M. Advisory Committee and an experienced
public company director, corporate executive and company adviser.
It may seek outside advice from time to time.
E.I.M. will publicise how it votes
using the following table updated from time to time:
| |
Resolutions |
For |
Against |
Abstain |
No Action |
|
Number |
9 |
9 |
0 |
0 |
0 |
|
% |
100 |
100 |
0 |
0 |
0 |
Reviewed and updated 21 June 2006.
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