AGM watch: Rio Tinto, British American Tobacco and Haleon

With AGM season about to kick off, Graeme Evans names key dates for the diary and looks ahead to important meetings at three FTSE 100 companies. Which way will you vote?

April means the start of the AGM season as shareholders get to flex their collective muscle on matters including boardroom pay, climate change, diversity and corporate performance.

By attending, voting and raising questions, you will do your bit for shareholder democracy as well as enhance your understanding of the business where your money is invested. And as previous years have shown, these events can be a powerful tool for change.

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Many of the meetings are available electronically and we will preview the major AGMs, starting today with coverage of Rio Tinto (LSE:RIO), British American Tobacco (LSE:BATS) and Haleon (LSE:HLN).

Dates in this year’s AGM calendar include:

Wednesday 19 April: British American Tobacco

Thursday 20 April:  Haleon, RELX, Segro

Tuesday 25 April: NatWest, Entain, Beazley

Wednesday 26 April: Anglo American, Persimmon, Bunzl, Smith & Nephew, Drax

Thursday 27 April: BP, AstraZeneca, Taylor Wimpey, Flutter Entertainment, Weir, Serco

Tuesday 2 May: Ocado

Wednesday 3 May: Barclays, Unilever, Reckitt Benckiser

Thursday 4 May: Aviva, BAE Systems, ITV, Mondi, Travis Perkins, Domino’s Pizza

Friday 5 May: HSBC, InterContinental Hotels

Wednesday 10 May: Antofagasta, Spirax-Sarco Engineering

Thursday 11 May: Rolls-Royce

Friday 12 May: Balfour Beatty

Wednesday 17 May: Aston Martin Lagonda

Thursday 18 May: Lloyds Banking Group, Legal & General, Next

Tuesday 23 May: Shell

Thursday 25 May: Prudential

Friday, 26 May: Glencore

Tuesday, 13 June: Centrica

Rio Tinto

When: 11am, Thursday 6 April.

Where: QEII Conference Centre, Broad Sanctuary, Westminster, London SW1P 3EE.

How to participate: Shareholders can attend virtually through the Lumi platform, which offers the ability to watch the meeting live, vote and ask questions. Those who are unable to participate in the meeting should submit a proxy form by no later than 11am, Tuesday 4 April. 

A separate meeting for Australian shareholders of Rio Tinto Limited takes place in Perth on 4 May, after which the results of both AGMs will be published. More details on the London AGM can be found here.

Who’s in the chair? Dominic Barton, who spent over 30 years at McKinsey & Company, is hosting his first meeting since starting in the role in May.

How did the company do in the year to 31 December? Underlying earnings of $13.3 billion (£10.9 billion) were 38% below 2021’s record year, reflecting lower commodity prices and the impact of rising inflation and significantly higher energy prices. Net debt of $4.2 billion (£3.4 billion) compared with net cash of $1.6 billion at the start of the year. The mining giant has declared a $8 billion (£6.6 billion) dividend for 2022 equivalent to $492 cents (406.98p) or 60% of earnings. This includes a final dividend of 185.35p a share for payment on 20 April.

How have shares performed? Up 18% to 5,798p (5,288p on Thursday).

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How much is the boss paid? Jakob Stausholm, who stepped up from chief financial officer in January 2021, is now on a basic salary of £1.23 million after a 4.5% increase was applied from the start of March. His total remuneration for last year amounted to £4.8 million, up from £2.8 million the year before. The 2022 figure included a short-term bonus in cash and deferred shares of £1.15 million, representing 48.7% of the maximum after Rio’s underperformance against financial targets. Environmental, safety and individual metrics were also used in determining the figure. The higher overall total reflected the vesting of £2.2 million of long-term incentive shares granted to Stausholm when he joined the company in 2018.

How did last year’s AGM go? The annual remuneration report was approved with 96% of votes in favour, a sharp contrast to 2021’s AGM when there was a protest over the pay deals awarded to departing executives including Jean-Sébastien Jacques in the wake of the destruction of the ancient aboriginal Juukan Gorge shelters. An advisory vote on the company’s climate action plan was backed with 84% support.

What’s the view of voting agencies? Glass Lewis recommends shareholders vote in favour of the annual remuneration report.

How’s the company doing on diversity? The percentage of women in the 52,000-strong workforce rose to 22.9% last year, although the annual increase was below the targeted two percentage points. In the boardroom, 30% of roles were held by women at the end of 2022 but this has since increased to 36% following the appointment of Kaisa Hietala at the start of March. Rio said it would seek to regain appropriate gender balance on the board during 2023. Ensuring continued ethnic diversity is also a key consideration, with one member of the board currently identifying as being from a minority ethnic background.

British American Tobacco

When: 11.30am, Wednesday 19 April.

Where: Hilton London Bankside, 2-8 Great Suffolk Street, London, SE1 0UG.

How to participate: Shareholders unable to attend the meeting have the opportunity to  submit questions online at bat.com/agm by 11 April. Proxy voting instructions must be received no later than 11.30am, Monday 17 April. More AGM details can be found here.

Who’s in the chair? Luc Jobin, the former chief executive of Imperial Brands Canada, has been chairman since April 2021 and non-executive director since July 2017.

How did the company do in the year to 31 December? Revenues rose 7.7% to £27.6 billion, including growth of 41% to £2.9 billion for newer categories. Profit from operations lifted 2.8% to £10.5 billion and adjusted earnings per share grew 5.8% to 371.4p, with £10.4 billion of net cash from operating activities representing a 7% increase. The dividend for the year rose 6% to 230.9p, payable in four equal quarterly instalments of 57.72p per ordinary share on 3 May, 18 August, 3 November and 1 February next year. A £2 billion share buy-back programme ended in December last year.

How have shares performed? Up 18% to 3,281.5p (2,823.5p on Thursday).

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How much is the boss paid? Jack Bowles received a 4.5% pay rise from 1 April, taking his base salary for this year to £1.38 million. His total remuneration for 2022 rose to £9.6 million, which was the highest single figure for the chief executive’s role since Nicandro Durante got £10.2 million in 2017. Bowles received £2.6 million from the short-term bonus scheme, down from £2.8 million the year before and equivalent to 77.7% of the maximum opportunity. The big jump in his overall remuneration from £8.1 million last time was due to the vesting of long-term incentives worth £5.2 million and representing 58.9% of the maximum.

How did last year’s AGM go? The new three-year remuneration policy was approved with 94.85% of votes in favour. The annual remuneration report got 95.61% support, better than the 38% of shareholders who opposed the report the previous year.

How’s the company doing on diversity? Women held 36% of board roles at the end of the year, with three directors from an ethnic minority background. Its diversity and inclusion ambitions for 2025 include having women in 40% of senior leadership roles.

Haleon

When: 3pm, Thursday 20 April.

Where: A digital only meeting to be broadcast from Hilton London Tower Bridge.

How to participate: Haleon’s first AGM since its demerger from GSK will be a fully-digitally enabled meeting. Shareholders who travel to the venue will be advised to take part electronically via the Lumi AGM platform. Questions can be asked on the day or in advance of the meeting and the deadline for proxy voting instructions is 3pm, Tuesday 18 April. More AGM details can be found here.

Who’s in the chair? Sir Dave Lewis was Tesco chief executive from 2014 to 2020.

How did the company do in the year to 31 December? The Sensodyne and Panadol consumer healthcare company’s revenues rose 13.8% to £10.9 billion, with organic growth of 9% split between 4.3% price movement and 4.7% volume and mix. Full-year operating profit increased 11.4% to £1.8 billion. An inaugural dividend of 2.4p a share is due to be paid on 27 April, representing about 30% of adjusted earnings for the period since the July listing.

How have shares performed? Down 1% since July to 327.5p (332.5p on Thursday).

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How much is the boss paid? Brian McNamara’s base salary for 2023 is unchanged at £1.25 million. Last year’s total remuneration for the period since his appointment in May amounted to £2.3 million, including just over £1 million after the annual incentive plan paid 72.3% of the maximum opportunity. Half of the awards earned after the demerger have been deferred for three years into conditional awards over Haleon shares. McNamara also received a one-off payment of £300,000 to reflect a change in his employment arrangements. Meanwhile, projections in the annual report show that an on-target performance in 2023 has the potential to generate £6.6 million, hitting a maximum of £12.8 million based on shares rising by 50% over the performance period.

What’s in the new remuneration policy?  The maximum annual bonus opportunity is 200% of salary, with the highest award under the long-term performance share plan being 450%. The chief executive’s shareholding requirement is 450% of salary.

How’s the company doing on diversity? The 11-strong board included five women at the end of 2022, although none are in the roles of chair, senior independent director, chief executive or chief financial officer. The company meets the Parker Review objective on ethnic minority representation.