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Big four bank ANZ has been served a vote of no confidence by its shareholders, with the company receiving its second strike in as many years at its annual general meeting on Thursday.
The company revealed 32.3 per cent of shareholders had voted against the bank’s executive pay scheme, above the 25 per cent required to be considered a “strike” and allowing investors to spill the board and re-elect the company’s directors.
ANZ chairman Paul O’Sullivan (left) with chief executive Nuno Matos.Credit: Aaron Francis
Those resolutions did not pass, however, with just 1.45 per cent voting in favour of spilling the board.
The backlash comes after a string of mishaps by the bank over the past 12 months. In September, ANZ agreed to a $240 million penalty to settle four separate legal cases from the corporate watchdog ASIC, including ANZ’s role as manager in the issuance of a 10-year government bond, where ASIC accused the lender of acting unconscionably.
ANZ also cut 3500 jobs during the year, with newly appointed chief executive Nuno Matos facing significant backlash from staff who disagreed with his ambitious change agenda.
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The cost of the redundancies, alongside the fines and other penalties paid by the bank, resulted in ANZ reporting a 14 per cent fall in cash profits to $5.8 billion in the last financial year.
At Thursday’s AGM, Matos acknowledged the bank’s failings throughout the year, saying as chief executive, he was “ultimately accountable”.
“Despite our good intentions, we have not consistently lived up to the expectations of our customers across all of our businesses,” he said.
“I want to stress to you today that we are going to get back to growth by getting back to basics and relentlessly focusing on customers across every segment and business of ANZ.”
Matos, along with the rest of the company’s Australia-based executives, will not receive any short-term bonuses for the last financial year due to the regulatory failings.
ANZ is also attempting to claw back $13.5 million in bonuses from its former chief executive Shayne Elliot.Credit: Alex Ellinghausen
ANZ denied former chief executive Shayne Elliott $13.5 million in bonuses in relation to the regulatory issues that occurred during his tenure; however, last week Elliott took legal action against the bank, arguing ANZ had breached its agreement.
Chairman Paul O’Sullivan said ANZ was committed to defending the bank’s position.
“Outcomes regarding unvested equity for some of our former executives have been, and will continue to be, made as those decisions fall due. I want to be really clear the board can – and will – make future adjustments where appropriate,” he said.
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“This methodical assessment over an extended period is consistent with the intent of the law, in terms of regulation, following the royal commission, ensuring accountability and alignment over time.”
ANZ also received a notable number of votes in favour of pushing the bank to do more on its climate commitments, including better disclosure around its financing of deforestation and lending to fossil fuel projects.
More to come
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