AMP share price slips amid expected first strike on remuneration

Shareholders appear to have rejected the company's remuneration report.

Key points
  • The AMP share price is down 0.74% at the time of writing, trading at $1.072
  • The fall comes as the company prepares to receive a first strike on its remuneration report
  • Shareholder feedback to the report encompassed numerous issues, with the company's chair also noting the stock's February falls "may have coloured shareholders’ views of management’s performance"

The AMP Ltd (ASX: AMP) share price is in the red as the company prepares for shareholders to reject its remuneration report at today's annual general meeting (AGM).  

Investors appear to have hit back at management on the back of a tumultuous February for the stock. It tumbled 23% last month amid the release of the company's full-year earnings.

The company's chair Debra Hazelton also addressed concerns over the rollout of the promised $1.1 billion capital return and how AMP Super votes on climate resolutions in a speech published to the ASX.

The AMP share price is $1.072 at the time of writing, 0.74% lower than its previous close.

Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is rising 0.71%.

Let's take a closer look at what the company's chair told investors at its AGM.

An investor sits in front of his laptop looking pensive and concerned.

Image source: Getty Images

AMP share price falls amid AGM

The AMP share price is underperforming after Hazelton acknowledged expectations its remuneration report will face a "disappointing" first strike.

A first strike will be called if upwards of 25% of the company's shareholders vote 'no' to its bonuses. AMP expects to take the hit based on votes cast prior to today's meeting. Hazelton said:

While we have already made significant changes to our remuneration framework over the past 12
months based on comprehensive engagement with investors, proxy advisors, remuneration experts
and regulators – we remain keen to understand and respond to feedback.

Such feedback pointed to the board's decision to award a bonus higher than the scorecard outcome and concerns about undisclosed short-term incentives. Hazelton stated AMP is continuously working to improve disclosures and remuneration was allocated "holistically" based on the 2022 scorecard and other factors.

Though, she admitted the stock's February falls "may have coloured shareholders' views of management's performance".

On that note, she dubbed the AMP share price's recent performance "extremely disappointing" but said, while the company's leaders are mindful of day-to-day gains and falls, they remain focused on the long term.

Over time, the company's stock should rise on the execution of its strategy and commitments, according to the chair.

One such commitment is its $1.1 billion capital return, which it plans to fast-track in response to shareholder angst.

Investors were asked to vote to allow another 500 million AMP shares to be bought back over the coming year.

She also clarified how AMP Super votes are decided by third-party fund managers. However, in a move that "indicates how important AMP regards climate risk", it recently moved to direct managers to vote on the topic of climate risks for select energy, materials, and utility companies, where possible.

Meanwhile, the ASX 200 chair looked back at prior challenges facing the company. Hazelton reportedly responded to an aggrieved shareholder saying, as per the Australian Financial Review:

The [Hayne] royal commission upended AMP's business model.

It had an enormous effect – almost existential.

The AMP share price remains around 80% lower than it was prior to the 2018 royal commission.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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