Shareholder group in plea on LSE director vote

AN INFLUENTIAL shareholder adviser has urged London Stock Exchange (LSE) investors to block the re-election of four directors at this month's annual shareholders' meeting, arguing they could not be considered independent.

Pirc urged its clients, which include many of the LSE's top institutional shareholders, to oppose the re-appointment of non-executive directors Janet Cohen, Sergio Ermotti, Andrea Munari and Robert Webb at the meeting on 20 July.

The recommendation from the advisory group, which counsels fund managers and pension funds, came a week after the collapse of the LSE's bid for Canada's TMX Group but is not directly related to the failure of that deal.

Instead Pirc said Cohen and Webb had been LSE directors for more than nine years - a term seen as the maximum a director can serve and remain truly independent.

Pirc also questioned the independence of Ermotti and Munari on the grounds that the former worked at Unicredit, which owns 6 per cent of LSE shares, and the latter works for Banca IMI, part of Intesa Sanpaolo , which has 5.3 per cent.

"There is insufficient independent representation on the board," Pirc concluded, though it urged shareholders to re-appoint chief executive Xavier Rolet, chairman Chris Gibson-Smith and other remaining directors. It said they should abstain on the re-election of non-executive Paul Heiden

A spokesman for the LSE declined to comment on the recommendations, but said: "An individual's independence cannot be determined arbitrarily on the basis of a particular period of service."