WATCH: How to align the expectations of shareholders and management

Very few companies in SA exist where incentives are even remotely aligned with shareholder value. Generally it appears remuneration committees and boards seem to think if you align remuneration to metrics such as earnings before interest, tax, depreciation and amortisation (ebitda) and revenue growth that this is value creative, without realising that these can and very often are grown while destroying value.

This lack of knowledge is remarkable as the most powerful thing one can do to improve performance is to align incentives with shareholder value.

How are shareholders going to get alignment with management here in SA? Michael Avery talks to Chris Logan of Opportune Investments and David Holland of Fractal Value Advisors, about what the starting premise is for your interactions with these companies.