Barrick Gold Corp.’s board is under attack from three pension funds opposing the re-election of directors and planning a protest vote over executive pay.
Ontario Teachers’ Pension Plan said Friday that the board still lacks sufficient mining-industry expertise, while British Columbia Investment Management Corp. said Barrick hasn’t been responsive to its concerns about bringing in new nominees.
PGGM of the Netherlands hasn’t seen any improvement in corporate governance since last year’s shareholders meeting, said Maurice Wilbrink, a spokesman for the asset manager.
The comments are the latest criticism the world’s largest gold producer has faced over its corporate governance and pay policies in the past two years. In January of last year, Barrick unveiled four new nominees and announced the retirement of founder Peter Munk as chairman after pension funds questioned the board’s independence.
“While we are supportive of the efforts for board renewal, we do not believe that sufficient progress has been made,” Ontario Teachers’, Canada’s third-largest pension-fund manager, said in an e-mail. “We have now lost confidence in the ability of the directors to effectively exercise their duties to our level of satisfaction.”
The compensation of John Thornton, the former Goldman Sachs Group Inc. banker who succeeded Munk as chairman, is a particular focus of much of the censure aimed at Barrick.
Last week, proxy advisory firm Institutional Shareholder Services Inc. said his 2014 pay of $12.9 million, up from $9.46 million the previous year, was “problematic at a minimum and seemingly unwarranted.” Ontario Teachers’ said Friday that senior management’s pay doesn’t match Barrick’s performance.
Shares of Barrick rose 1.4 percent to C$15.62 in Toronto. They have dropped 21 percent in the past 12 months, while the S&P/TSX Global Gold Sector Index is down 8.4 percent in the period.
Barrick managers are measured against long-term performance and are rewarded with stock, tying their personal wealth to the company’s successes, Andy Lloyd, a Barrick spokesman, said in an e-mail. The company has now added six new independent directors with significant experience in relevant areas for the company, he said.
Barrick defended Thornton’s pay in a filing this week, outlining his achievements in 2014 and saying that the chairman owned almost 1.4 million Barrick shares, half of which he bought with his own money.
Thornton is excluded from Barrick’s partnership compensation plan for top executives and mine managers. An initial group of 35 partners, named last month, will receive their long-term incentive pay in the form of shares that can’t be sold until they leave the company.
Barrick’s shareholder meeting is on April 28. The vote on executive pay is non-binding.
Ontario Teachers’ owned 0.06 percent of Barrick as of the end of last year, according to data compiled by Bloomberg.