Since the emergence of “Modern Portfolio Theory” and the “Capital Asset Pricing Model” in the late 1960s, institutional investors have taken a quantitatively driven approach to portfolio construction, looking to create portfolio diversification and obtain better risk-adjusted returns by balancing their asset-class exposures. This journey has seen several important advancements in thinking about how to optimally achieve desired results.
Funds that want to take the total portfolio approach first need to get the total portfolio view. To do that they not only need data – and lots of it – but a rock-solid understanding of exactly how they’re going to use it.
Company boards ‘getting the message’ – ACSI study
(Pictured: Ann Byrne)
The Australian Council of Superannuation Investors, which last week announced its new chief executive, has confirmed that the composition of Australian company boards is becoming more diversified, including the addition of more women.
The results of ACSI’s 12th annual survey of top 200 ASX-listed companies show that directors’ fees have not moved much – in fact, the movement is down for chairs – and there is an increasing number of women and first-time directors. The survey is conducted by advisory firm Ownership Matters.
ACSI’s outgoing chief executive, Ann Byrne, who is scheduled to retire in October, said: “The trend among S&P/ASX100 companies is to look beyond the ‘usual suspects’ and make appointments from a more diverse pool of candidates.
“Boards are clearly getting the message from investors that the recruitment of non-executive directors has to be a more professional and disciplined process than it once was.”
In 2012, women finally broke the “100 in the 100” barrier – there are now 105 women, occupying 144 roles, on the boards of Australia’s Top 100 listed companies. One in four of all new directors appointed in 2012 were also female, with the result that women now hold just over 18 per cent of all ASX 100 board seats – the highest level since ACSI began its surveys.
Results show that while gender diversity is improving, the rate of change remains slow across the Top 100 and even slower among companies in the S&P ASX 101 – 200. Results of the study show:
- Women account for less than 10 per cent of all individuals serving as directors of ASX 101 – 200 companies.
- Women held 9.9 per cent of all ASX 101 – 200 board seats, a slight improvement over 2011.
- More than half of ASX 101-200 boards again had no female directors in 2012.
On remuneration, the average for top 100 companies non-executive directors was $218,434 ($215, 721 in 2011) and for ASX 101-200 companies $134,981 ($130,227). For non-executive chairs, the averages were $481,415 ($498,938) for top 100 companies and $225,534 ($253,886) for ASX 101-200 companies.
Byrne leaves ACSI after an impressive career in super, having been the chief executive of two big funds, STA and UniSuper, before taking on the ACSI role in 2008.
ACSI’s new chief executive is Gordon Hagart, head of environmental, social and governance risk management at the Future Fund.
