Shareholder returns

Company returns to shareholders are not enough.  For example, say a company has a half a billion shares on issue: for every $5 million it spends on increasing remuneration, that's one cent removed from the dividend to shareholders.  Currently we have boards and executives enjoying huge remuneration increases that massively outstrip shareholders' returns.  It has to stop.  You can make it stop.  You have a superannuation fund: it almost certainly owns shares in large companies.  Write to your super fund and demand that they vote against these huge increases.  Here's the letter I wrote to mine - feel free to cut and paste so you can send it to yours.  It will probably be far more effective and efficient than camping in the city square with some smelly hippies!!

Complaints Officer

HESTA Super Fund

PO Box 600

Carlton South, Vic 3053

Dear Sir/Madam,

I write to you upon receipt of my annual report.  Thanks you for actually making money this year.  You managed to make about 10% which is pretty good.  However when I look at the segmented earnings I see that the return on share investments was not as good.

It is for this reason that I must demand that you vote against company remuneration reports for any companies I have an interest in who propose to increase directors and/or executive remuneration beyond any increase in shareholder returns from profits.

It is inexcusable for these already well paid people to continue to expect that shareholders stand idly by whilst company profits are used solely to line their pockets.  Super Fund managers must start to take action to protect the long term interests of members.  Shareholders should not be expected to have capital gains be their only avenue to profit from share investing.  This seems to have become commonplace over the past decade and it must cease.

Given recent articles in daily newspapers and other media, I believe that I should expect to see some board spills over the next 12 months as fund managers exercise their fiduciary duty to their members and vote against wage rises and excessive remuneration packages at company AGMs.

Please do not disregard this notice.

Sincerely,

Graham Bushnell

Bushnell is back! Some short comments on current topics.

Occupy Anywhere Protests
Congratulations 'organisers': Those who are members of rent-a-crowd anonymous and 'I've got an irrelevant axe to grind' international now have somewhere to go.  They are currently bottling up city streets all over the world chanting about being poor or gay or short or fat or not rich enough or controlled by the man.  BEST IDEA EVER - we'll just have a giant protest with no purpose or proposed outcomes!

Apparently it started as a protest against those fat cat bankers.  Have to say I can agree with that.  Squandering my savings, stealing my investment returns as bloated wages and generally not adding anything tangible to the progress of society.  But Western countries re still allegedly "free", so they have a right to do that stuff if there's a market for it.  I won't be asking for more government control (of anything).  I will be voting against remuneration reports and directors at annual meetings and I will be writing to my super fund to request they do the same for my stolen money.  No one can add their bullshit agenda to that kind of protest.


Industrial Relations in Australia
Again congratulations!  This time to the lefties who voted in this terrible minority government.  Strikes are back in fashion.  As are go-slows on construction sites and closed shop workplaces.  Union power is growing again and holding back the economy - right when it can't afford to be held back in most sectors.  Union membership is still in decline.  More power to another minority!

Note to workers: Your union doesn't look after you - it looks after itself.  By that I mean its political power base and leadership.  Why else did they all merge in the 80s and 90s?  Easier for the ACTU and ALP to control.


Mining Tax
Pray that this is not passed by parliament in it's current form.  It is diabolical.  The original proposal as per the Henry Taxation Review is the correct structure for this tax.  It is fair and even.

The mining tax is an important policy that must be passed as it will slow down the investment in mining which is crowding out the rest of the nation's economy.  Don't think that these projects won't ever happen because of a tax - that is utter crap.  They just won't all happen at once.  Since you can only dig up the country once, it's important that we don't sell it all in the next 40 years.  It's also really important for the owners of the holes (taxpayers) and not just those doing the digging to get the best returns possible.  This tax will also provide a revenue stream for all that infrastructure and middle class welfare taxpayers keep asking for.