The £20bn (€23.3bn) RPMI is set to vote against the entire board of California-based technology company Oracle Corporation in a dispute over executive pay and board accountability.

Joined by €140bn Dutch pension manager PGGM and the $172bn (€125bn) California State Teachers’ Retirement System (CalSTRS), the UK’s RPMI decided on the “unusual” step, according to its corporate governance counsel Deborah Gilshan, after the firm’s compensation committee failed to engage with its concerns.

In a letter co-signed by Gilshan and her PGGM and CalSTRS counterparts Catherine Jackson and Anne Sheehan, the pension managers asked fellow Oracle shareholders to consider in whose interest the company’s board was acting after it ignored an attempt to get last year’s executive remuneration package approved by a majority.

The letter noted: “At the 2012 annual shareholders’ meeting, the advisory vote on pay not only failed to receive a majority vote in support, but, by our calculations, 86% of independent shareholders voted against the resolution.

“This is not a situation any board should ignore, even taking into account the advisory nature of the pay resolution, as it is clearly a request for change by shareholders.”

The letter continued that there had been “no substantial changes” in Oracle’s compensation structure since, and that the board was therefore failing in its duty to shareholders.

“It’s an unusual step for us to be voting against the entire board, but we feel the board needs to take collective responsibility for its lack of action.”

Deborah Gilshan, RPMI

As a result, the three investors said they would withhold their support for the current board at the annual general meeting on 31 October.

“Consistent with this view,” they added, ”we further consider it is in the best interests of our beneficiaries to support the shareholder proposal seeking the appointment of an independent chairman to the board and to vote against the advisory vote on pay.”

The letter also noted that concerns were not merely limited to executive pay, but that it extended to “wider issues of proper board accountability”.

Gilshan told IPE it was an unusual step for RPMI to be acting so publicly, but that it was “a signal of the severity of our concerns in this case”.

“We feel we’ve undertaken our responsibility as shareholders to vote, engage and to write to the company with our concerns,” she said.

“We’ve tried to engage with the compensation committee, and they weren’t able to meet with us to hear our concern.”

She added: “It’s an unusual step, as well, for us to be voting against the entire board, but we feel the board needs to take collective responsibility for its lack of action.”

Jackson, corporate governance adviser at PGGM, went so far as to call their objections to the board “unprecedented” and said repeated attempts were made to raise the investor group’s concerns over the lack of performance vesting targets in incentive awards, as well as the discretion granted to Oracle’s compensation committee.

“We have chosen to address all shareholders’ directly,” she said, referencing the letter filed with the US Securities and Exchange Commission, “in favour of attending the annual shareholders’ meeting, as we feel this is a more effective way of having our concerns heard.”

She added: “If our concerns aren’t heard during tonight’s AGM, we will consider all our options.”

Gilshan would not be drawn on the potential outcome of the vote, which will be known following today’s AGM in California.