More empty gesture politics*

From the BBC:

Plans for directors to submit to an annual shareholder vote form part of an overhaul of the code of conduct for the UK's top 350 listed companies. It is a seen as a way to increase accountability, as directors are currently re-elected every three years...

1) There is absolutely no rule that directors have to put themselves up for re-election every three years. It was included in the standard Table A articles, but shareholders have always been free to stipulate a longer or shorter period.

2) It does not matter how often the vote is held, it matters who votes. It would be far, far better if we reinstated the small-shareholder culture that existed before the system was manipulated to favour 'institutional investors' (pension funds, unit trusts, insurance companies etc), seeing as small shareholders are more likely to kick up a stink, whereas those empowered to vote on behalf of the 'institutional investors' are in cahoots and interchangeable with the boards of directors of the companies they own.

We reinstate the small-shareholder culture by simply scrapping all the tax breaks for owning shares via a pension fund etc. and giving those tax breaks (primarily exemptions from Capital Gains Tax and higher rate tax on dividends) to ordinary investors instead. Cut out the middlemen, if you see what I mean.

3) The article then wails on about 'diversity' in the boardroom. Big deal. If you want there to be more female directors, then you can buy shares in a plc and vote for female candidates, and so on. This might improve things, it might make them worse - we'll never know until we try it.

That's that fixed. Next.

* That's probably a tautology.