This afternoon's annual general meeting for the Stockland Group is likely to spark controversy with the Australian Shareholders' Association (ASA) deciding to vote against two resolutions.
The ASA is concerned with the property group's remuneration structure, and will vote against the approval of the remuneration report and the granting of 1.26 million performance rights.
Fifty per cent of Stockland's long-term incentive award is based on total shareholder return (TSR) relative to peer companies. What troubles the ASA is that executives were being rewarded while security holders had to endure huge losses in value.
According to the Financial Review, Stockland's TSR was negative 41.3 per cent between 2007 and 2009 but because other companies were worse off, 100 per cent of the TSR component was vested.
"In a period of such turmoil and such negative returns for security holders, the executives are amply rewarded by their base salary. Quite honestly, in a year such as we experienced, hanging onto your job and getting a handsome base salary should be considered adequately rewarding," director of the ASA, Michael Perry told the Fin Review.
