Forum wants Marks to split the top jobs

Mar 31 2009 by Iain Laing, The Journal

A GROUP of shareholders has renewed its call on high street retailer Marks & Spencer to appoint an independent chairman.

The Local Authority Pension Fund Forum has tabled a shareholder resolution calling on the group to split the roles of chairman and chief executive.

The forum, whose members hold just over 1% of M&S shares, has long opposed the company’s 2008 decision to allow Sir Stuart Rose to combine the roles of chairman and chief executive.

It said the move was a clear breach of the UK Combined Code on Corporate Governance, and previously warned that if an independent chairman was not appointed by the 2009 annual general meeting, it would table a shareholder resolution calling for one.

It said its resolution was intended to provide a safety valve for shareholders who wanted the company to uphold best practice in terms of board structure, but did not want to vote against the re-election of Sir Stuart.

LAPFF chairman Ian Greenwood said: “The separation of powers at the head of a company is a fundamental governance principle, and one that is accepted by the rest of the market.

“Ultimately corporate governance is about ensuring that the right structures and policies are in place to ensure that companies are well run, to the benefit of all concerned.

“The combined code has evolved over time through patient collaboration between companies and investors. Therefore any company that effectively says to investors, we don’t need to follow the rules, raises a red flag.”

The move comes as M&S is due to update the market on its fourth-quarter sales figures today.

Analysts are pencilling in a 9% decline in general merchandise sales.