Capital Markets & Investor Relations Australia
Welcome to the latest edition of Global IR Insights, where FTI Consulting's Australian Strategic Communications team shares intel from our global network in capital markets communication and what it might mean for Australia.
A Full-Throttle Dealmaking Revival
The?Financial Times reports that four of the largest US private capital groups - Ares, Apollo, Blackstone, and KKR – invested over US$160bn in the last quarter as deals heat up, with Scott Nuttall of KKR optimistically stating, “The deal market is back”. Nuttall’s outlook highlights an open market and a significant pent-up supply of deals.?
What is behind his confidence? The US Federal Reserve’s aggressive interest rate rises over the last 18 months have put a hiatus on dealmaking, but with the possibility of a rate cut, this could change quickly. According to data provider Preqin, private equity firms are sitting on more than US$2tn of capital currently committed to investments yet to be applied.?
How could this push impact us back home??
No strangers to Australian companies, US private equity firms have been central to major Australian acquisitions and investments over the past five years. This appetite is increasing, and with the deal market in the US set to boom, Australia may soon see an increase in deals and investments reaching our southern shores.
Virtual & Hybrid AGMs In The Spotlight
The?Australian Institute of Company Directors (AICD) has initiated a senate review on virtual & hybrid AGMs, evaluating their effectiveness and challenges since their introduction during COVID-19.
With a focus on shareholder and member participation and costs, the review will also look at whether this structure achieved the goal of flexibility and technology-appropriate execution of documents and whether fraud or misuse occurred.
A recent analysis by King & Wood Mallesons showed that hybrid meetings are now the preferred format, with 61% of ASX 200 companies adopting the method in the 2023 season.?
This suggests a shift towards keeping AGMs hybrid to facilitate stronger investor engagement.
领英推荐
Our team has three tips on how to master your next virtual or hybrid AGM:
How To Measure Executive Success: Short-Term vs Long-Term Incentives
CEO and executive incentives have long been a balance of base salary and performance-based, but how impactful are short-term performance measures on companies?
A recent article in CFO Magazine highlights how executive remuneration has surged over the past few years, most of which comes from short-and medium-term performance incentives. The potential clawback of ~$9m of Alan Joyce’s ~$21m of incentives paid in his last 12 months, a ‘time when the Qantas brand… plummeted to Australia’s most distrusted airline’, highlights the challenge for boards to incentivise appropriately.
According to?The Guardian, “Chief executive salaries rose an average of 14% in the past year despite many companies calling for wage restraint for low-paid workers due to inflation concerns.”
How should CEOs & Executives be rewarded and incentivised??
As noted in the CFO Magazine article from the Harvard Law School Forum, ‘To be successful, companies need to attract and reward leaders who create value over the long term, but executive remuneration often focuses on short-term targets.’
Incentive plans need to be appropriately balanced to encourage the right behaviours and ensure management doesn’t lose sight of the big picture. It is important to have incentive plans that address not just financial performance but foster investments in ESG, innovation, and employee engagement to deliver growth and promote company culture over the long term.
To be added to the Global IR Insights newsletter distribution list, please contact [email protected]