The Australian Shareholders Association (ASA), whose stated aim is to "protect and enhance the interests of investors", has released the names of six company chairmen "it believes should retire from their present roles." The release of the names coincides with the upcoming Annual General Meetings (AGMs) of the companies in question.
Heading the list is Paladin Energy (ASX: PDN) Chairman Rick Crabb. The ASA highlights Crabb's 19 years as a director, the lack of a dividend since 1994 and the US$1.3 billion in accumulated losses over those 19 years as the reason for calling for his departure.
Fairfax Media's (ASX: FXJ) Mr Roger Corbett has also come up for criticism by the ASA. Although not due to stand for election until the 2015 AGM, the ASA has put Mr Corbett 'on notice' not to seek another term, determining that his involvement with Fairfax, whose share price has declined from $3 to 60 cents during his decade on the board, is reason enough for him to leave.
Next in line is Tatts Group (ASX: TTS) Chairman Harry Boon. Although the ASA does not appear to have any direct criticism of Mr Boon's involvement with Tatts' performance, it highlights a string of problems at other listed companies Mr Boon has been on the board of.
Leighton Holdings' (ASX: LEI) recent headline grabbing problems should make for an interesting AGM this year. Given that Chairman Bob Humphris has been on the board during Leighton's past controversies, the ASA is calling for him to leave and allow a new, independent chair not associated with the past controversies to step into the role and take the company forward.
According to the ASA, Aurizon Holdings (ASX: AZJ) has now had three years of remuneration controversy. For this reason the association is calling for Chairman John Prescott to step down, highlighting that he has been in the role since 2006.
Lastly, White Energy (ASX: WEC) Chairman Travers Duncan "has been adversely named by the ICAC (Independent Commission Against Corruption) in relation to the Mt Penny coal tenement and ASA will be opposing his re-election at the AGM in Sydney on November 22."
Foolish takeaway
The spoils of being the chair or board member of a publicly listed company are obviously appealing and can mean some members stay longer than they should. Likewise the lack of attention often paid by institutional shareholders to voting their share holdings and influencing board composition means that all too often a lack of scrutiny or board renewal occurs.
