Last week Boris Johnson announced the Living Wage to be £8.30 for London. The Living Wage campaign, started by Citizens UK, recently celebrated its tenth year of trying to boost the incomes of those on the lowest rungs of enterprise. One way to speed up the campaign is through shareholder activism, buying a share and attending the annual general meeting of a company to raise the issue.
On Monday, I attended the Centrica AGM on behalf of advocacy group FairPensions, to see if the board would be willing to commit to the Living Wage. Centrica are the guys that run British Gas, and they have a large number of employees in lower salary brackets, for example, all the call-centre staff.
You’re playing to a tough crowd when you do shareholder activism. Think about who actually attends a three hour meeting starting at mid-day: Most are loyal supporters of the company and many are former employees, now retired. They have a slightly sycophantic edge, especially considering part of their self-identity is wrapped up in their years of service to the company. It’s easy for the chairman to turn them against anyone raining on the parade.
|THE GUYS WHO RUN BRITISH GAS|
So my strategy was as follows: 1) Wear a smart suit, 2) drop in Boris Johnson’s name to deflect suspicions of left-wing status, 3) suggest the Living Wage is becoming recognised as an important mark of commitment to Corporate Social Responsibility, and that, as such, it’s an important business decision, and 4) that as a shareholder, I believe it to be an issue which needs to be carefully assessed by the board.
Those should prevent you from being seen as a raving radical quack, and forces a serious response from the board. Unfortunately, it doesn’t guarantee you anything of substance: In his response to my question, Chairman Sir Roger Carr gave a true politician’s answer, asserting that the company paid more than the minimum* wage, whilst avoiding direct mention of commitment to the Living Wage.
There was a tea afterwards, in which the directors mingled with the shareholders. I used it to chat to three of the directors, including the head of the American business. Treat them with respect and they’re forced to do the same back. He assured me the Living Wage issue would be brought up at their next CSR meeting.
Shareholder activism is but one method of getting yourself heard, and it has its limitations, but it can be a surprisingly effective way to get up close and personal with senior management of the world’s largest companies.
*(the minimum wage is considerably lower than the LivingWage)