Mexico’s proposed higher mining royalties could block nearly $7bn in investments
The Mexican government proposed raising mining royalties under the argument that metal prices have risen in recent years.
Shares in Barrick Gold, the world’s top producer of the metal, lost over a third of its market value last year.
John Thornton, executive chairman of the Toronto-based miner, earned $13 million last year. That’s up from 2013’s $9.5 million, but still below the eye-watering $17 million in 2012 which included a roughly $12 million golden hello.
Three of the world’s largest pension funds – Ontario Teachers’ Pension Plan, British Columbia Investment Management and the Netherlands’ PGGM Vermogensbeheer – have now decided they don’t like that discrepancy at all and will vote against the re-election of the board.
The Wall Street Journal reports the funds “are not among ABX’s biggest investors, and some other shareholders have expressed support for the board, but complaints from the funds may act as a rallying call for protesters.”
The Ontario Teachers had some choice words for Barrick’s top brass who are rewarding themselves handsomely while the company wallows in $10 billion debt:
“We do not believe that sufficient progress has been made in crafting a board with the appropriate set of skills we assess that Barrick needs,” the statement says. “Coupled with our ongoing concerns with the compensation decisions taken by the board, we have now lost confidence in the ability of the directors to effectively exercise their duties to our level of satisfaction.”
The spat stands comes despite the overhaul to executive compensation Barrick announced last year. That plan was called “Barrick Redefines Compensation, Introduces Most Shareholder-Friendly System in Canada“.
The pension funds clearly don’t relish the irony.
4 Comments
Will Thompson
Good on the pension funds. The directors should cut their wages by 3/4 until they figure out how to run a company.
LAMB
I have NEVER seen so much greed and incompetence in one company – time to change BARRICK from the TOP down. They need real MINERS in there who understand the business, NOT a bunch of pansies lolling on the Board pulling in Directors pay.
Hados
Nice example of shareholders working for the board. Too much of that behavior exists in mining which is why most institutional investors never touch the sector.
CDNJoe2
I loaded a single blast at a Canadian mine that unearthed $23 Million worth of diamonds. The community, our country and our economy would have been far better off if the workers that generated that wealth had just pocketed the stones and used them to enrich their home communities. Instead, it was the fat cats at the top of the companies food chain that took the stones and hid their profits in off shore, tax sheltered accounts.
With the global economy in such sad shape, when every country in the world has to struggle to show signs of growth, it’s time to cut the fat.
Time to start rewarding those that generate new wealth. Not the old boys club that take it, hide it and keep millions they don’t even need for themselves.