The Parliamentary Secretary to the Treasurer, the Hon Chris Pearce MP says draft legislation released on 7 February will make it easier for shareholders to participate in corporate governance processes, while "striking a more appropriate balance between the
rights of different groups of shareholders".
He said the legislation would remove the "100-member rule" which currently requires
companies to hold special general meetings at the request of only 100 shareholders. A minimum of five per cent of total voting shares would be required to requisition a special general meeting.
Mr Pearce said a number of new proposals had been developed to enhance shareholders’ capacity to participate in scheduled meetings.
These proposals include:
- making it easier for minority shareholders to place resolutions on the agenda of scheduled company meetings
- requiring companies to distribute members’ statements along with notices of meetings
- requiring proxy holders to vote in accordance with shareholder instructions. This would improve shareholder confidence in proxy voting by preventing the questionable practice of "cherry-picking" proxies, whereby proxy holders lodge votes that accord with their own views while withholding contrary votes.
The proposals are contained in the Corporations Amendment Bill (No2) 2005. Submissions on the draft Bill will be accepted until 1 April 2005.