Annual Conference sees the GECN emerging as a stronger independent global compensation and governance adviser

Annual Conference sees the GECN emerging as a stronger independent global compensation and governance adviser

The sixth Annual Conference of the Global Governance and Executive Compensation Group (GECN) took place in Zurich from 6 to 8 January, hosted by Swiss-based group member, HCM International.

The GECN is a group of five independent advisory firms specialising in executive compensation and corporate governance. It comprises 95 professionals operating from nine offices globally (www.gecn.com). GECN member firms have offices in Los Angeles, New York, London, Kiev, Geneva, Zurich, Singapore, Melbourne and Sidney. MM&K represents the GECN in the UK.

Key topics discussed were how to co-ordinate and optimise leverage of the wealth of knowledge and consulting experience that resides within the GECN to add value to clients globally. Good progress has been made over the past year, as evidenced by the increasing number of global projects won by GECN member firms working together.

The GECN adds value globally through objective, tailored advice and implementation provided by high-quality independent professional firms. The advice provided by GECN is supported by the Group’s data collection, research and analysis facilities.

In 2019, GECN interviewed 25 institutional investors and their advisors globally to gather information about the areas of corporate governance behaviours which are of most concern to them. Perhaps not surprisingly, ESG factors appear high on the list. The report of this research is available from Margarita  Skripina

This year, GECN will look at the ways in which corporates globally have been tackling the issues raised by investors.

For more information, please contact: Paul Norris or Margarita  Skripina.

 

MM&K partners with The London Stock Exchange, First Flight and Board Excellence in a seminar for AIM companies on directors’ pay, governance and board effectiveness

MM&K partners with The London Stock Exchange, First Flight and Board Excellence in a seminar for AIM companies on directors’ pay, governance and board effectiveness

On 20 June, MM&K Chief Executive, Paul Norris made a presentation at The London Stock Exchange (LSE) to an audience of AIM companies and advisers on designing fit-for-purpose remuneration policies. He was joined by Naomi Scott-Mackie a consultant in First Flight (non-executive search) and Kieran Moynihan (Managing Partner in Board Excellence) to reinforce the message that developing and maintaining a successful remuneration policy requires an independent, robust and well-functioning Board, operating within a sound governance framework.

An effective Board and a sound governance framework are essential to the overall success of any business, but independent non-executive directors (NEDs) and good governance are particularly important in the context of executive remuneration. AIM companies are not “quoted companies” and so are not bound by the Companies Act strict remuneration disclosure requirements. As AIM companies are not listed on the main board of the LSE, the UK Corporate Governance Code does not bind them. However, AIM companies are required to adopt a corporate governance code (many adopt the QCA code) identify it on their web-site and explain how they have complied with its principles. Instances of non-compliance and the reasons for it, must also be identified.

Corporate governance is catching up with AIM but with a lighter touch than for quoted companies listed on the main board. In an environment of lighter regulation (in which AIM operates) it becomes even more important to demonstrate to investors and other stakeholders  how the Board takes account of their interests and that the company is being run sustainably for the benefit of all its stakeholders.  This includes developing a remuneration policy that is demonstrably fit-for-purpose because it is competitive, supports the business strategy and is affordable (taking account of the economics of the business and stakeholder requirements).

There are more than 1,400 AIM companies. Some of them are large corporations, which could (there are those who might say should) be listed on the main board. Many are early-stage, growing companies with large appetites for cash to fund their growth but few of the resources available to their larger peers. They all need good relations with their stakeholders. What amounts to fit-for-purpose remuneration for one AIM company will not necessarily be fit-for-purpose for another. Fortunately, flexibility exists to tailor a good result.

The seminar was well-attended and there was a lively discussion after the three presentations concluded.  It is clear that this combination of complementary presentations struck a number of chords with the audience. MM&K is pleased to have participated in this event in partnership with the LSE, First Flight and Board Excellence and looks forward to repeating the experience. The seminar slides are available here.

MM & K Limited advises extensively among AIM companies. For more information about executive remuneration, please contact: Paul Norris

MM&K’s Golf Day at Hankley Common

MM&K’s Golf Day at Hankley Common 

MM&K hosted its annual golf day on 21st May again at Hankley Common Golf Club in Surrey. We were pleased to have 22 clients and friends of MM&K come and join us to play a well contested four ball competition in the morning. Some hardy souls managed to play more golf in the afternoon after a well-earned and delicious three course lunch and drinks.

The weather was fantastic for golf, largely sunny with a light breeze. One client had the best round of golf he had ever played, going round in 76, five over par gross. Not surprisingly he was in the winning team.

Hankley Common is a wonderful (but not that well known) classic Surrey heathland course and it was in superb condition. One kind client remarked afterwards: “What a fabulous day – thank you all so much – The course was in great condition- a real privilege to play it”.

2019 MM&K Private Equity / Venture Capital Breakfast Seminar

2019 MM&K Private Equity / Venture Capital Breakfast Seminar

In early April, MM&K held a PE/VC Breakfast Seminar for the participants in its last three PE/VC Compensation Surveys. At the seminar the 2018 Landscape of the Private Equity / Venture Capital industry was discussed. We also discussed the outlook on what 2019 may hold for the industry.

Prior to the event, MM&K organised a 2019 Pulse Survey, that was sent out to all of the invitees to the seminar, to get a picture of the most up-to-date Remuneration and Staffing trends in the UK and European PE/VC industries. Also, some of the interesting insights and findings from the 2018 MM&K PE/VC Compensation Survey were presented to compare with the results of the 2019 Pulse Survey.
The event opened with a networking opportunity for all the attendees and closed with a vocal Q&A session.

2019 MM&K Private Equity / Venture Capital Pulse Survey

This short  Pulse Survey focuses on the most recent developments in the UK and European Private Equity / Venture Capital industry. The Pulse Survey is run for the benefit of MM&K’s PE/VC Compensation Survey participants, and provides them with an outlook on the most up-to-date trends in compensation and staffing levels in the PE/VC industry.

91% of participating houses indicated a salary increase across all of their professionals at their most recent review date.  However, only 15% indicated increases in bonus levels for their investment professionals (over 2018).

About 70% of the participants indicated they focused on selected groups of staff when determining bonuses for last year’s performance. 86% of firms expect an increase in the number of investment professionals in 2019.

All in all, there remains perhaps a surprisingly high level of confidence in the industry, which is encouraging to see.

If you are working in a Private Equity / Infrastructure / Venture Capital House and you believe that your firm might like to participate, please contact Margarita Skripina or request your questionnaire here.

MM&K recently held one of its regular Remuneration Dinners for CEOs and Non-Executive directors.

Please click here to read an overview of the evening in which the theme for discussion was: “Could Remuneration Committees take a more active approach to gaining the high ground on executive pay?

The 5th Annual GECN Conference in Sydney

The 5th Annual GECN Conference in Sydney  – “MM&K continues to develop its global reach”

Between 4th and 7th January, Paul Norris and Nigel Mills attended the fifth Annual Conference of the Global Governance and Executive Compensation Group (“GECN”) in Sydney.

The GECN is a group of independent firms, whose logos appear below, specialising in advising corporate clients on executive compensation and good governance. GECN member firms have offices in London, Geneva, Zurich, Kiev, Singapore, Melbourne, Sydney, Los Angeles and New York. MM&K has been the UK member firm since 2015.

It is consistent with good corporate governance principles for remuneration committees to have access to high quality independent advice on executive pay. Increasingly, clients need advice which combines best in class local know-how and a deep understanding of policies and practice on a global scale, so a core theme of this year’s conference was how GECN member firms can work even more effectively together to serve this need.

A practical example of GECN’s ability to present a global perspective was the lunch organised by our Australian member, Guerdon Associates, with one of Australia’s largest investment banks, which also has a significant global presence. MM&K advises the bank’s alternative investment arm in London. The lunch was attended by the bank’s Chairman, CEO, Remuneration Committee Chair, Committee members and Global Head of HR. During lunch, GECN members (who, in addition to Guerdon and MM&K, included Farient Advisors, from the USA and HCM, from Switzerland) were able to recount their first-hand experiences of advising other global banking entities in the world’s financial centres on dealing with challenges similar to those confronting our hosts, whose feedback clearly indicates that they found the discussion stimulating and helpful.

Collectively, the GECN gathers and analyses a large amount of data. Swiss member firm, HCM, has established a data collection and analysis centre in Kiev. Recognising the importance of data and its role in providing clients with intelligence and independent advice, conference spent some time considering how best to harness GECN’s collective resources to provide clients with relevant data, intelligence derived from that data and sound, independent advice.

Conference also considered important external issues concerning executive pay and good governance. Ms Pru Bennet, who heads BlackRock’s governance and voting for all Asia Pacific, gave a presentation and answered questions on the challenges and potential in China. Ms Bennet’s colleague, Ms Flora Wang, who has specific responsibility for the People’s Republic of China and Hong Kong, attended by phone to contribute some specific local knowledge. This was a most informative session, which added to our global font of knowledge.

Conference was not all work over a long weekend. It was summer in Sydney (a welcome change from winter in London!) and conference organiser, Guerdon Associates, made sure we had opportunities to enjoy both Sydney’s hospitality and its culture. Next year’s conference moves back to Europe, where it will be hosted by our Swiss member firm, HCM.

To learn more about the services offered by the GECN and MM&K, please contact Paul Norris or Nigel Mills

 

Please click here for the notes from our 11 June 2018 MM&K Remuneration Dinner for Chairmen, CEO’s and Remuneration Committee Chairs.

The theme for discussion was: “Bonus plans and how to make them better”

Please click here for the notes from our 19 March 2018 MM&K Remuneration Dinner for Chairmen, CEO’s and Remuneration Committee Chairs.

The theme for discussion was: “The Evolution of the Remuneration Committee,  impact of proposed changes to the UK Corporate Governance Code