COMMONWEALTH BANK OF AUSTRALIA | Amendment to the Constitution

Status
3.52% votes in favour
AGM date
Previous AGM date
Proposal number
5
Resolution details
Company ticker
CBA
Lead filer
Market Forces
Resolution ask
Adopt or amend a policy
ESG theme
  • Governance
ESG sub-theme
  • Shareholder rights
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
Australia
Supporting materials
Resolved clause
Insert into the constitution in clause 6 ‘General meetings’ the following new sub-clause: “The company in general meeting may by ordinary resolution express an opinion or request information about the way in which a power of the company partially or exclusively vested in the directors has been or should be exercised. Such a resolution must relate to a material risk identified by the directors or the company and cannot advocate action that would violate any law or relate to any personal claim or grievance. Such a resolution is advisory only and does not bind the directors or the company.”
Supporting statement
Shareholder resolutions are a healthy part of corporate democracy in many jurisdictions. For
example, in the UK shareholders can consider resolutions seeking to explicitly direct the
conduct of the board. In the US, New Zealand and Canada shareholders can consider
resolutions seeking to advise their board as to how it should act. Typically, unless the board
permits it, Australian shareholders cannot follow the example of their UK, US, New Zealand
or Canadian counterparts in this respect.
A board of directors is a steward for shareholders and accountability for the discharge of that
stewardship is essential to long-term corporate prosperity.
In rare situations the appropriate course of action for shareholders dissatisfied with the
conduct of board members is to seek to remove them. However, in many situations such a
personality-focused approach is unproductive and unwarranted. In those situations a better
course of action is to formally and publicly allow shareholders the opportunity at shareholder
meetings such as the AGM to alert board members that the shareholders seek more
information or favour a particular approach to corporate policy.
The constitution of CBA is not conducive to the rights of shareholders to place resolutions on
the agenda of a shareholder meeting.
In our view, this is contrary to the long-term interests of CBA, its board and shareholders.
Passage of this resolution – to amend the CBA constitution – will simply put the company in
a similar position in regard to shareholder resolutions as any listed company in the UK, US,
Canada or New Zealand.
We encourage shareholders to vote in favour of this resolution

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