RBS feels the heat as investors at Ulster Bank back shareholder move
More than 100 investors at Ulster Bank parent Royal Bank of Scotland have thrown their support behind plans for a shareholder committee meant to address corporate governance issues at the UK lender.
ShareSoc, the UK's individual shareholder society, is set to deliver documents relating to the proposed resolution to RBS's London offices this afternoon in the hope that it will be put to a shareholder vote at the bank's annual general meeting in May 2018.
The group said current methods of shareholder engagement - including "cosy chats with selected shareholders behind closed doors" - does not work for the broad shareholder base, adding that it is unclear whether investors are receiving the same information or if it is being "spun".
ShareSoc chairman Mark Northway said: "Shareholders, including individuals, deserve a new approach - one with greater involvement and more effective input from them as ultimate owners.
"RBS, given its incredibly poor track record and consequent taxpayer support, should now be leading from the front in governance matters."
It is the second time the shareholder society has tried to establish a bespoke committee at RBS after the bank rejected a similar proposal earlier this year.
ShareSoc claims RBS had been "hiding behind tenuous, expensive legal arguments" in order to block its creation.
The group's director and campaign manager, Cliff Weight, said: "We are hoping RBS will engage with us and work constructively in developing an improved corporate governance framework.
"Since ShareSoc first engaged with RBS in December 2016 there have been several positive developments which we recognise and applaud, but there remains much more to be done on shareholder democracy". RBS said it was aware that the group was running another campaign to launch a shareholder committee.
"Whilst it is of course the role of the company directors to represent shareholders, we will review any proposal that is submitted and make our response clear in due course," the lender said in a statement.
The shareholder group has condemned RBS for a raft of historic failings that included a culture of "excessive risk, short-termism, greed and irresponsibility", as well as excessive bonuses and executive pay that has "impacted the brand".
The lender was also criticised for treating customers unfairly, mis-selling mortgage-backed securities in the US as well as payment protection insurance (PPI) in the UK, its Libor-fixing scandal, and the ongoing controversy over how its Global Restructuring Group (GRG) treated small business customers.
That is on top of concerns over top-level diversity, with only four women included in its "pale, male and stale" 14-strong board, the shareholder group said.