The QBE Insurance Group Ltd (ASX: QBE) share price is enjoying some time in the sunshine today. QBE shares are up a healthy 2.31% at the time of writing to $9.74 a share. That’s significantly outperforming the broader S&P/ASX 200 Index (ASX: XJO), which is ‘only’ up 0.4% to 7,093 points today.
However, zooming out and the picture is far less rosy for QBE Insurance. This company has been a serial underperformer for years now. QBE is still more than 35% below its pre-COVID highs of ~$15 a share. Additionally, it’s also more than 70% below its all-time high. And that all-time high is from way back in September 2007.
Yes, anyone who has bought QBE shares before 2020 is probably in the red. In fact, it’s conceivable that the vast majority of QBE shareholders, or at least those with less than impeccable luck in market timing, have experienced nothing more than a few percentage points of growth at the very best.
QBE to face the music at AGM
Well, that’s not a recipe for a happy shareholder base. And we are seeing that play out this week. We had news yesterday that the Australian Shareholders’ Association (ASA) will be voting against the QBE remuneration report at its upcoming annual general meeting (AGM). The AGM will take place on Wednesday 5 May.
Here’s some of what ASA company monitor Ian Graves said to justify this move:
The main issues with the company are the financial performance, with an average total shareholder return over the past five years of -2%, and we have concerns the high turnover in senior management is linked to this lacklustre performance.
It’s not just the remuneration report either. The ASA has also lost concern in a number of member of QBE’s board and leadership team:
In addition to voting against the remuneration report, we will vote against the re-election of Mr Stephen Fitzgerald, Deputy Chair of the People and Remuneration Committee after dissatisfaction with the remuneration structure for a number of years. We will also be voting against the re-election of a number of long-serving directors, Sir Brian Pomeroy and Ms Jann Skinner, given that they have been on the QBE board since 2014 and the continuing poor results over a number of years and a range of issues the company is currently dealing with.
Not the first rodeo
This is not the first time QBE has been faced with such a revolt. The insurer faced similar moves in 2018 and 2019, with the company narrowly avoiding a ‘second strike’ in 2019’s AGM. It also faced shareholder outrage last year when it dismissed its CEO Pat Regan. This was over “workplace communication” incidents that were not entirely made public.
Whatever happens at the AGM next month, we can be sure shareholders will be hoping for a better year ahead than the ones recently gone by.