The Australians have it right

What to learn from the Australians

In my last post, I noted that the Americans amended SEC Item 407(c)(2)(vi) of its Regulations S-K to set out guidelines for the Nominating Committees to follow with respect to recruitments processes and attention to diversity membership. Specifically, they were to consider issues of diversity during both the recruitment and nominations processes. This activity was to be guided by a Board policy related to diversity together with a procedure on its implementation and evaluation. As I also noted, the flaw in this otherwise laudable approach was that "diversity" was not defined, for the purposes of the regulation. Therefore, the definition used varies according to region and corporate culture and included race, background, experience, and education as well as gender. 

The weakness of the Canadian approach was covered. 

In 2010, the ASX made amendments to the ASX Corporate Governance Council as these applied to promoting gender diversity on Boards of ASX listed companies. 

Again, the Canadians might take notice. While the TSX focused its attention on Boards recruiting the right mix of skills and experience, the ASX has included gender diversity as a criteria for Board recruitment. The ASX recommends that Boards should make a statement as to mix, skills and gender diversity a Board seeks to achieve. The ASX also recommends that Boards disclose , in a statement in their annual reports, how they expect to achieve diversity. The ASX also expects corporations to publish their diversity policies AND goals and to evaluate how effective they have been in achieving those goals.

There is , however, more sophistication at play than one finds either in Canada or the US. The ASX has recognized that the problem in  recruiting women to the Board may lie in the "pipeline" of women to the Board. Corporations are also expected to report on the proportion of women in the corporation, the proportion of women in senior management positions as well as the number of women on the Board. The focus of the ASX , therefore is also o developing women for leadership positions within the Corporation. 

The ASX, in fact, provides a practical approach to the implementation of the CCGG recommendations.

How safe is your pension?

The plight of  Canadian Sears employees is a crime. A robber baron, aka hedge fund hack, buys the company to strip it of its assets,  and taking money for himself ; money which might have been applied to the under funded pension plan. To add salt to the wound, senior managers are given hefty (like millions) severance settlements. Instead, as Sears goes under, pensioners have no recourse and are forced to take cents on the dollar for pensions, if they are lucky. 

Where was the government to help these folks?
Where are regulations to protect these people?
This looks a lot like Nortel wherein the senior management got out with millions leaving that company's pension plan in tatters too?
I guess that that wasn't a big enough fiasco for government at any level to step in and help. I'm sorry...would that mean that civil servants would be proactive?

Some of you may have government pension plans.
So, you may feel safe and snug.
But....are you right to feel that way?
How solvent is your plan and how solvent is the government through whom you have your pension? 

Not all provinces are that solid, financially.

1) Does your province have:

• a declining population,
• high unemployment,
• very high debt,
• poor educational attainment,
• poor voter turnout (23% municipal, 45% provincial)
• high rate of child poverty,
• only 2-3 major employers which tend to run off small business or just buys them out
• 1:10 employed people working as civil servants, 
• a plan which is not 100% vested,
• here is some advice.....you might want to consider your options for saving , NOW. 

what kind of a pension plan is not making money in a 9 year bull market??

Here are some markers that you, the pensioner, need to consider as you evaluate your plan.
These are also questions that you would be advised to ask of your plan. 

1) Do you attend the annual meeting?
2) Does the Plan have a website wherein you can ask questions...and get them answered?
3) Is the Board trained? Do members have continuing educational opportunities? Do they have a Acc.Dir designation or a C.Dir designation?
4) Are Board member bio's published? If not, what is being hidden?
5) Is attendance recorded for each member?
6) Are committees described with membership? Is the rationale for membership by committee described?
7) How is compensation managed and is executive compensation reported? Is compensation related to fund performance? Do pensioners have a say on pay?
8) Is there management oversight ? Are the results of management evaluation reported?
9) Is Board (member) performance evaluated and are those results reported?
10) Are a majority of Directors independent? How is independence defined? 
11) Are external advisors used by the Board to double check management advice to the Board? When? How often? For what issues?
12) Are there Board policies and are these listed on the website?
13) Are these aligned with the CCGG guidelines?
14) Is there a whistleblowers policy? Are concerned reported to the board and are these listed on the website?
15) How are proxies managed?