Our hopes have been dashed
ANN CROTTY: Why you should care about executive remuneration
Are most of our large fund managers captured?
SA is being let down by the fund managers who are supposedly looking after our financial interests. These days all but the super-rich must use professional fund managers to take care of their often-mediocre savings or pension entitlements.
It is possible for the very determined to actively manage a small portfolio but it requires considerable know-how and lots of determination. Like it or not, we’re forced to rely on the judgment of professional fund managers. We hope they will do whatever they can to protect and grow the value of our investment. We hope they will act ethically and in society’s best interests. While we are the ultimate "beneficial" shareholders, they are the nominees and are in the driver’s seat.It now seems all that hope is misplaced. We have PwC’s latest executive remuneration survey to thank for pointing this out. PwC established that our biggest fund managers were overwhelmingly backing the remuneration policies of our biggest companies. Coronation, Investec and Stanlib were 85%-95% likely to approve a company’s remuneration policy. This is the level of support usually enjoyed by corrupt dictators. It smacks of a system that does not work.
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