ASX directors club facing scrutiny over links to big four audit firms
Some of the biggest names on the ASX could face pressure over board members who previously worked at their external auditor, with the exchange itself hit with a protest vote this week.
More than two dozen ASX-listed companies are facing scrutiny over potential conflicts for board directors who previously worked for their auditors, as powerful proxy advisors clamp down on the cosy relationships between major corporates and the big four accounting firms.
ASX director and ex-PWC partner Anne Loveridge became the latest board member to face a rebuke over the issue after she was hit with a 16.8% protest vote against her re-election at the exchange operator's AGM on Thursday. Loveridge, who joined the board only three months ago, still easily obtained the majority vote required to be elected, but the vote against her was higher than is typically usual.
The rebuke came after powerful proxy advisory group Institutional Shareholder Services (ISS) raised concerns about audit committee members who previously worked for the company's external auditor. ISS quietly published the change to its policy guidelines in August with the heightened scrutiny now expected to hit a number of directors as AGM season rolls on.
Independent analysis being circulated among investors and viewed by Capital Brief indicates audit committees at more than two dozen ASX-listed companies including medtech darling ProMedicus, retailer JB Hi-Fi, miners Pilbara Minerals and Lynas, data centre provider NextDC, and financial services company Perpetual would fall foul of the new recommendation.
