PIC Rejects South African Mining Companies’ Pay for Second Year

Public Investment Corp., the biggest South African investor with $125 billion of assets, voted against executive pay at some of the country’s biggest gold-mining companies for a second year.

PIC rejected pay plans at AngloGold Ashanti Ltd., Gold Fields Ltd., and Royal Bafokeng Platinum Ltd. at their annual general meetings in April and May this year, it said in a statement published on its website. The public workers’ fund manager also voted against Sibanye Gold Ltd.’s pay for non-executive directors.

“The remuneration policy appears to be inconsistent with best practice,” PIC said of AngloGold’s pay policy, citing insufficient disclosure of performance targets. Non-executive directors’ fees “are out of line when compared to companies of the same size,” it said.

PIC has been speaking directly to mining chief executive officers about excessive remuneration at a time when costs are increasing at double-digit rates and revenues are declining, Fidelis Madavo, who manages mining investments at PIC, said last year.

Sibanye’s market value has more than doubled to about 22 billion rand, meaning the PIC’s criticism that pay was “too high for a small-cap company” was more relevant when it first listed in February 2013, James Wellsted, a spokesman for the producer, said by e-mail. About 91 percent of shareholders backed the pay policy, he said.

AngloGold spokesman Chris Nthite declined to comment. Gold Fields spokesman Sven Lunsche said the company engaged with PIC before and after the vote, and the majority of investors had passed the resolution. Royal Bafokeng didn’t immediately respond to requests for comment.

The fund manager also voted against the pay plans of South Africa-listed companies including Barclays Africa Group Ltd., Exxaro Resources Ltd., ArcelorMittal South Africa Ltd., and Pick n Pay Stores Ltd.

Of PIC’s 46 votes against companies’ AGM resolutions, 46 percent, the largest amount, were rejecting pay policies.

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