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Proxy advisers need more than Investor Relations code

Corporate and M&A
Proxy advisers need more than Investor Relations code
In an opinion article published in The Australian newspaper, Partner Jeremy Leibler argues that proxy advisers need more than a voluntary code to address concerns related to conflict of interest and independence.

While the Australian Investor Relations Association has drafted a code of engagement, Jeremy says that this code falls well short of any genuine oversight.  

“Proxy advisers undoubtedly play an important role in the market. If regulated effectively, and performing at their best, they could provide sound, accurate, tailored and independent advice that institutional shareholders could reasonably rely on when making significant voting decisions”.

“But at this stage in the industry’s evolution, they are more focused on covering up the obvious deficiencies in their operating model and refusing to entertain the idea that well-considered regulation would strengthen, rather than weaken, their standing and influence”.

Jeremy also highlights the need for Australia to match regulatory activity in the US, Canada, Britain and the European Union.

“It’s time we joined other leading economies and introduced the kind of regulation that would support proxy advisers in clearly delineating their roles and responsibilities, while providing certainty to all stakeholders that the financial advice being produced by the industry really is clear, correct and conflict-free.”

To read the article, click here.

Jeremy leads the firm’s shareholder activism practice and has previously questioned the role and called for ASIC oversight of proxy firms.

Oversight of power by proxy is long overdue was written by Jeremy Leibler and published in The Australian on 13 July 2017.

For more information, or to arrange an interview, contact Claire Tedeschi, ctedeschi@abl.com.au, +61 (0)457 822 642.

About Arnold Bloch Leibler

Arnold Bloch Leibler is a premier Australian commercial law firm that provides strategic legal and commercial advice nationally from its offices in Melbourne and Sydney to a diverse range of leading Australian corporations, high-net-worth individuals and large family businesses as well as international corporations. Arnold Bloch Leibler also has a dedicated pro bono practice providing advice on social, environmental and cultural issues to more than 150 charitable and not-for-profit organisations.

Arnold Bloch Leibler is particularly known for its expertise in banking & finance, commercial & corporate, competition, litigation & dispute resolution, insolvency, property, taxation and workplace advisory. In these areas, the firm is regularly involved in landmark matters and transactions.