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UK public pension funds blast GlencoreXstrata over Hayward appointment

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  • City of London

Sixty UK local authority pension funds, with around £120bn (€147bn) in assets, are to vote against appointing Anthony Hayward as chairman of GlencoreXstrata, citing his inability to create a mixed-gender board.

The public sector funds, under the guidance of the Local Authority Pension Fund Forum (LAPFF) said it would oppose Hayward’s nomination due to his links to the directors nomination committee.

GlencoreXstrata is now the only company in the FTSE 100 index with an all-male board and will put forward two males for election as non-executive directors.

The LAPFF said, given that the company has yet to set targets for female board representation, Hayward, as chair of the nomination committee over the last year, must bear responsibility.

Hayward is former chief executive of oil giant BP, before his resignation following the company’s part in the Gulf of Mexico oil spill.

Councillor Kieran Quinn, chair of the forum, said: “The forum will be advising members to oppose his re-election.”

Quinn, who also chairs the Greater Manchester Pension Fund, a £12.5bn scheme, said the forum warned companies it was going to be increasing its engagement approach.

“The company has yet to set any target for female representation, nor has it disclosed to shareholders the proportion of women in executive management positions in this year’s annual report,” he said.

“There is no 2015 target disclosed for a proportion of women on the board. The LAPFF signalled a firming up of its engagement approach, that it would review the diversity status and disclosure of all FTSE 100 companies and recommend oppose votes where progress was lacking.”

The current level of holdings between the 60 funds in GlencoreXstrata is difficult to tell given the mix of active and passive mandates held by the members.

Given the level of assets held by the schemes, and the company’s significance to the FTSE 100 index, exposure to GlencoreXstrata would be both widespread and significant, a spokesman said.

The funds were also one of several institutional investors to reject Barclay’s remuneration report, although eventually they lost out by a two-thirds majority.

At the time, the forum said pressure from institutional investors was the only meaningful way to spur change at the banks, and other holdings.

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