Hat-tip to Responsible Investor for a fascinating news story about Dutch bank De Volksbank considering giving stakeholders such as employees and customers a vote at their AGM alongside shareholders. This is framed in terms of shift away from shareholder value / primacy to a "shared value principle".
The background to this is that De Volksbank is state-owned, having been in public ownership since the forerunner SNS Bank failed a few years back, and is expected to be privatised.
An interesting aspect of the article is the response from Eumedion: “We are sceptical whether an agency model with multiple principals will improve accountability and transparency. It may also increase complexity in decision-making by the so-called stakeholders meeting. Paralysis may be the consequence.”
I personally think the ESG world needs to encourage more experimentation of the type being considered, but hey. Asserting that a multi-stakeholder approach is cumbersome and complex is an old defence of shareholder primacy, and feels out of step with where the governance debate is currently (see, for example, Keith Skeoch's views in the previous).
It also reminds me of the approach some investors took towards another Dutch company - DSM - back in 2007 when it tried to do something different by trying to introduce loyalty dividends. And in the end they killed it. Let's hope there will be a bit more tolerance this time.
It should also make people in the UK think about RBS. If Theresa May is serious about wanting to see more stakeholder representation in the corporate governance of PLCs, why not start where the state can make it happen? Surely it's time to walk the talk?
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