NBR, 18 July 2008, Table Talk by Nicki Crauford

With 30-40% of our population about to reach retirement age during the next three to five years delegates at the recent Australian Institute of Company Directors national conference were urged to start developing strategies to attract and retain mature workers. One speaker noted that the needs of older workers seemed to fall through the cracks, suggesting that companies skew their resources to support the career and life aspirations of younger workers who, ironically, don’t intend to stay as long as their more experienced colleagues. Increasingly, senior executives are rejecting the traditional notions of retirement.  They want to channel their experience and capabilities into a portfolio of rewarding activities – for example, different corporate roles, reduced hours, mentoring, becoming a board member or project expert.  The biggest roadblock to change was often senior executives themselves - concerned that by discussing the possibility of winding down, they might signal they had lost interest or were showing signs of weakness.

Say on pay gains traction
Get ready for US legislation requiring listed companies to give shareholders annual votes of confidence on corporate pay policies. Democratic nominee Barack Obama has already backed it, and his Republican opponent, John McCain made his surprise support for ‘say on pay’ official and unequivocal: “If I am elected president, all aspects of a CEO’s pay, including any severance arrangements, must be approved by shareholders.” Actually, Senator McCain’s wording makes it sound like he would make such votes mandatory, as the Dutch do. Senator Obama, and a bill passed with bipartisan support in the Congress, would make them advisory, as in the UK and Australia.

Talk shop goes online
RiskMetrics Group (www.riskmetrics.com) has launched an online forum intended to spur dialogue among shareholders, corporate management and board members on big governance issues. Dubbed 'Governance Exchange', the idea is for RiskMetrics officials to referee an exchange of ideas and best practices on a wide variety of corporate governance topics. Test runs over the past few months have centered on issues such as compensation disclosure, succession planning and shareholder activism. RiskMetrics intends to supplement confidential online dialogue with webcasts, white papers, surveys and analysis. Directors and investors don’t talk much in real life, so getting them to do so in the virtual world may prove a challenge.

Telling it straight
Consistency, straightforwardness, succinctness and clarity are considered hallmarks of good practice when preparing annual reviews, according to a new guide on reporting to shareholders. The guide, prepared by Ernst & Young and G100, states that the annual review's format should be consistent so that shareholders are able to make easy comparisons with reports year-to-year. However, that does not mean reporting and business developments, which could improve the effectiveness of the reporting format, should be overlooked for the sake of consistency with prior year reports. The annual review should also be written on the assumption that shareholders are not industry or finance specialists. Narratives should be concise and the report written in plain English with a simple layout so key messages are readily identified.