Logistics group John Menzies has announced the retirement of chairman Iain Napier – just two days ahead of its annual shareholder meeting.
The former chief executive of housebuilder Taylor Woodrow and brewing company Bass has been at the helm of the Edinburgh-based baggage handler and newspaper distributor for six years, having joined its board initially as a non-executive director in September 2008.
We believe directors sit on a board to represent the interests of shareholders, and that the nominations and remuneration committee should explicitly address the issues that raised shareholder concern. We do not believe that has been done hereGlass Lewis
He will step down at the end of the Menzies annual meeting on Friday, with the firm saying he had “expressed his wish to retire, in line with the reduction of his other plc responsibilities”. He is due to retire as chairman of cleaning products maker McBride at the end of next month.
Menzies has already seen two high-profile departures this year. Chief financial officer Paula Bell last month said she was leaving to join telecoms company Spirent, while in January the firm surprised the City by announcing the departure of chief executive Jeremy Stafford for “personal reasons” after just over a year in the role.
Napier’s departure comes after shareholder advisory group Glass Lewis recommended that investors vote against his re-election at Friday’s annual meeting. Last year’s shareholder gathering saw more than 26 per cent of votes cast against its remuneration report, while a third of votes were withheld, and Glass Lewis said none of Menzies’ directors received more than 84 per cent support, including abstentions.
The researcher’s note, seen by the The Scotsman, said: “We believe this raises concerns about whether the nomination and remuneration committees are fulfilling their duties to shareholders given that the board has failed to address these high levels of opposition in the company’s most recent annual report.
“We believe directors sit on a board to represent the interests of shareholders, and that the nominations and remuneration committee should explicitly address the issues that raised shareholder concern. We do not believe that has been done here.”
Glass Lewis has also recommended that investors vote against the re-election of non-executive director Geoff Eaton, who serves on Menzies’ audit and remuneration committees.
At last year’s annual meeting, more than 20 per cent of votes were against the re-election of Napier, who also chairs the group’s nomination committee, and it is understood that Swiss activist investor Lakestreet Capital Partners – which was among the dissenters – was poised to voice its opposition again this week.
Lakestreet, which today revealed it has increased its stake in Menzies to almost 8.6 per cent, has been pressing the Menzies board to consider breaking the business up, arguing such a move would increase its valuation.
Menzies said that company veteran Dermot Jenkinson, who has been on its board for three decades, will become its interim chairman and run the process to appoint a permanent successor.
Jenkinson said: “The board would like to thank Iain for his considerable contribution to the John Menzies business and board over the last eight years.
“He has marshalled us through significant periods of change over his tenure with great skill and experience. We wish him the very best for the future.”
In March, Menzies said it was considering further bolt-on acquisitions across the UK, having snapped up a string of parcel delivery firms, after posting a drop in full-year profits.
Pre-tax profits came in at £18.2 million for 2015, down from £25.7m the previous year, while turnover remained broadly flat at £1.99 billion.