First Super investment committee chair Michael O’Connor told InvestorDaily that First Super has a “strong view” about the importance of splitting the role of chair and chief executive officer, claiming a failure to do so could constitute inadequate governance.
He added that a number of JP Morgan’s directors are “fundamentally not fit” to maintain their positions with the bank, adding that First Super accepts the position of adviser groups who are recommending their shareholders vote against the re-election of a number of directors.
JP Morgan told InvestorDaily it endorses the re-election of its current directors, saying they have helped guide the company through the financial crisis “without a single losing quarter and have led the company through three years of record performance”.
First Super said it will be contacting its overseas equity managers to express concerns about governance issues at the bank. These include Global Thematic Partners, Blackrock, Capital International and Orbis Global Equity Fund.
Mr O’Connor said First Super has made decisions to divest previously when the fund believed attempts to improve governance had failed, referring to a decision in January to sell down its holdings of News Ltd shares.
“We take very seriously our responsibilities to our members to invest their money in entities with robust governance and a strong track record of responsible corporate behaviour,” Mr O’Connor said.
“From First Super’s point of view, we [believe fund managers] need to be exercising their duties in a way which clearly safeguards our investments and certainly higher standards of governance is an important way of demonstrating that.”
