The Australian Securities Exchange has come out against a Productivity Commission recommendation that would see board members up for re-election if 25% of shareholders vote against a company’s remuneration report in consecutive years.
The ASX says the controversial two-strikes proposal gives shareholders “undue influence”.
In a submission to the Commission, the ASX said the proposed 25% threshold should be raised to 50%. It said the 25% threshold would provide too much power for smaller investors.
“Setting such a threshold would imply, inappropriately, that such decisions were even more significant than decisions around the issuance of new shares involving dilution of existing holding and major acquisitions and disposals,” the ASX said in its submission.
The submission comes after a large number of corporations and businesses spoke out against the proposals.
Housing loans jump
The total value of owner occupied housing commitments, excluding alterations and additions, increased by a seasonally adjusted 6.7% during September, according to the latest figures form the Australian Bureau of Statistics.
In personal finance, the total value of commitments decreased by a seasonally adjusted 1.8%, with revolving credit commitments down 2.2% and fixed lending commitments down 1.4%.
For commercial finance, the total value of commitments has increased by 8%, with fixed lending commitments and revolving credit commitments up 9.3% and 4.8% respectively. Lease finance commitments also decreased by 3.6%.
Shares higher after flat Wall Street results
The Australian sharemarket has opened slightly higher today despite flat results from Wall Street, where investors are assessing yesterday’s rally due to a promise from the G20 to continue funding economic stimulus.
The benchmark S&P/ASX200 index was up 27.2 points or 0.57% to 4760.8 at 12.00 AEST. The Australian dollar also opened higher above US93c.
NAB shares increased 0.9% to $30.41, while ANZ also jumped 0.5% to $22.91. AMP rose 1.4% to $6.48 while Westpac gained 0.5% to $26.53.
Meanwhile, Wesfarmers chief executive Richard Goyder has said another rate rise next month could bring consumer confidence down further.
“I’ve been slightly unhappy with the two interest rate increases we’ve had already,” he said. “I understand the reasoning of the Reserve Bank in doing it… but I think consumer sentiment is fragile and increasing interest rates does potentially reduce people’s take home income.”
ACCC delays ruling on Caltex-Mobil deal
The Australian Competition and Consumer Commission has delayed its ruling on Caltex’s proposed acquisition of 302 Mobil service stations to the 2 December.
The deal would see Caltex purchase the sites for $300 million, but the move is subject to the approval of the ACCC and the Foreign Investment Review Board.
Telco giant Singapore Telecommunications has increased its quarterly net profit by 10%, with subsidiary Optus also recording an 18% rise due to growth in mobile services.
At Optus, net profit for the first half was up 18% to $291 million, while second quarter net profit was 22% higher to $152 million. Revenue rose 7.4% to $2.22 billion for the quarter ending 30 September.
“Optus strengthened its challenger position in the market following four quarters of double-digit mobile service revenue growth,” Optus chief executive Paul O’Sullivan said in a statement.
“In addition, it continued to build profitable scale across its fixed networks with the fixed on-net telephone customer base now exceeding one million.”
Overseas, Wall Street results have remained flat after yesterday’s rally, while new proposals from the Senate Banking Committee have suggested the Federal Reserve’s powers should be contained.
In a plan to reform the role of the Fed, senator Christopher Dodd has proposed financial regulation reform that would see the Fed stripped of its bank supervising role, while the president would also be able to name the chairman of each of the 12 regional Fed boards.
The Dow Jones industrial average gained 20.03 points, or 0.20%, to end at 10,246.97, while the Standard & Poor’s 500 Index fell 0.07 of a point, or 0.01%to finish at 1,093.01.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
