The Telstra chairman, John Mullen, has taken a swipe at critics of executive pay by saying that while teenage Fortnite players can earn millions, someone who is well rewarded for devoting their life to a career in business is derided as “morally wrong”.
Speaking at the telco’s annual general meeting in Sydney on Tuesday, Mullen warned that talented executives might shy away from running Australia’s biggest companies because of criticism about pay.
An overwhelming 97.4% of shareholders voted to approve the telco’s remuneration report at the meeting, a sharp contrast to last year’s 62% vote against that sparked 12 months of consultation by Mullen.
But he said that while talented business people once aspired to run big firms, they might now think twice.
“Young kids are earning $5m playing Fortnite but when a business executive devotes a huge portion of their life … that it’s somehow morally wrong they get rewarded for it,” he said.
Mullen’s remarks on pay kicked off an annual shareholder meeting season that nevertheless is expected to focus on corporate Australia’s response to the climate crisis.
BHP and Origin Energy are among companies to face shareholder resolutions over global heating while other companies are set to face questions over social issues ranging from slavery to the deportation of asylum seekers.
Meanwhile, discontent over pay is expected to continue, although at a lower pitch than last year when a dozen top 200 companies received “strikes” – votes of 25% or more against the remuneration report.
The Telstra director Craig Dunn’s position on the telco’s board has been under pressure because of his long stint as an executive with AMP, which saw its share price plummet after last year’s banking royal commission revealed that the financial services group misled the corporate regulator at least 20 times over a scandal in which it charged customers fees for services they never received.
He received a vote against him of almost 30%, more than three times as much as the opposition to two other directors also up for election, Nora Scheinkestel and Eelco Blok.
Market observers also expect the chair of gambling giant Tabcorp, Paula Dwyer, to attract a healthy protest vote for the second year in a row when the company’s shareholders meet next Thursday.
Her 13-year tenure on the board, which includes the group being hit with a record $45m fine for failing to properly combat money laundering, represented a “performance not at group 1 level”, one market source said.
BHP’s Anglo-Australian structure, where it is listed both on the London and Australian stock exchanges, means it will face British and European shareholders on Thursday and antipodean ones next month.
One of the mining giant’s biggest shareholders, Standard Life Aberdeen, last week backed a shareholder resolution put forward by the Australasian Centre for Corporate Responsibility and endorsed by the tech billionaire Mike Cannon-Brookes calling on BHP to quit industry bodies that have positions on the climate out of tune with the company’s position that fighting the crisis requires “the biggest global mobilisation since the second world war”.
Activist anger is focused on the Minerals Council of Australia, which Australia’s biggest superannuation fund has attacked for not taking a strong enough position on the climate, and an associated body, Coal21.
A similar resolution to be debated at Origin Energy’s AGM in Sydney on Wednesday has been withdrawn, but it still faces four shareholder motions dealing with the climate crisis and the environment.
These motions include one calling on the company to disclose the cost of mitigating particle pollution from its elderly New South Wales coal-fired power plant at Eraring – something the company says is not needed because it already keeps the emissions below legal limits.
Traditional owners unhappy at the process by which Origin gained consent for fracking in the Beetaloo Basin will protest outside the meeting in Angel Place. Shareholders will be able to vote for a resolution challenging the development process.
In finance, three of the big four banks – ANZ, NAB and Westpac – will face climate resolutions when they meet later in the year. Activists have spared CBA, which meets on Wednesday.
At its AGM on 13 November supermarket giant Coles is to face Australasian Centre for Corporate Responsibility (ACCR) motions calling on it to eliminate slavery and exploitation from its fresh food supply chain, while next week Qantas will be asked to stop forcibly deporting asylum seekers on its planes under a contract with the Australian government.
None of the shareholder resolutions are likely to pass – most generally attract only a few per cent of the vote – but activists claim they have helped to force companies to change their positions.
“A little bit of scrutiny is a healthy tonic for the formation of capital,” Dean Paatsch, the co-founder of proxy adviser Ownership Matters, said.
He said the AGM was “not dead” but a lot of work was done behind closed doors.
“More directors and shareholders are talking to each other than ever before in the time I’ve been doing this, which is 18 years,” he said.
“If you’ve got a fight on the day, it’s because they’ve been talking past each other.”
Dan Gocher, director of climate and environment at the ACCR, which is attending 20 AGMs over the next six weeks and bringing four resolutions, agreed that investor understanding of issues such as modern slavery had grown thanks to the campaigns.
“As much as people judge success on a vote, it also creates a space for companies to discuss the issues,” he said. “If there is no resolution, will they have the conversation? Probably not.”