Rose braces himself for more dissent
MARKS & SPENCER yesterday faced fresh pressure over Sir Stuart Rose’s dual role as chairman and chief executive as corporate governance body Pirc joined the growing calls for an independent chairman.
Pirc said: “Combining the two roles in one person represents a dangerous concentration of power that is potentially detrimental to board balance, effective debate, and board appraisal. We believe the combination of roles at a listed company can only be justified on a temporary basis under highly exceptional circumstances.”
Pirc added its voice to that of Local Authority Pension Fund Forum (LAPFF) which has filed a resolution for the 8 July annual shareholder meeting calling on M&S to appoint an independent chairman by July 2010. Influential shareholder advisory body Risk Metrics on Tuesday also joined calls for M&S to split Sir Stuart roles.
The retailer last night told City A.M: “Both parties want the roles to be separated, it’s a disagreement on process rather than principle.”
The Association of British Insurers has amber-topped its report on the company. In the US, Glass Lewis has recommended clients vote in favour of LAPFF’s resolution as has Marco Consulting.
In a bid to appease shareholders, M&S deputy chairman David Michels told investors he would like to chair the retailer.
It is believed that an early move by Michels to become chairman could spur Rose to quit before his planned retirement in July 2011. Some 22 per cent of investors abstained or voted against Rose’s election as executive chairman last July.
M&S argues that the combined roles are necessary for its succession-planning process. M&S said that reverting to split roles in 2011 “provides ample time jointly to develop internal candidates and evaluate the external market”.
M&S plans to appoint a new chief executive next year.