Corporate governance: new trade union voting and engagement guidelines

The TUC and its two largest affiliated unions, Unite and UNISON, have formed a new shareholder voting group, the Trade Union Share Owners, which aims to put union values at the centre of corporate governance.  This group has drawn up a set of policy guidelines and will work with the shareholder advisory group PIRC to ensure that their funds take a common voting position in accordance with those guidelines. 

Focusing initially on FTSE350 companies, the guidelines contain a variety of policy positions including:

  • moves to limit the growing gap in the pay of those at the very top and bottom of companies, with the aim of achieving a 20:1 pay ratio, and for pay increases to directors to mirror those being offered to ordinary employees;
  • persuading all companies to become living wage employers on the basis that decent wages lower staff turnover and absence rates, and lead to a more motivated, productive workforce;
  • encouraging companies that are keen to include worker representatives in their corporate governance structures;
  • achieving a balance on company boards between executive and non-executive directors;
  • at least a quarter of board positions to be held by women;
  • all board vacancies to be advertised, rather than people simply being invited to join;
  • a limit to the number of board positions that directors can hold.  Where individuals are unable to devote enough time to their role, their re-election should be opposed.

 

These new guidelines can be viewed here.

Search our site