Building merchants business Grafton Group saw support for its chairman waver at its AGM as nearly a quarter of shareholders failed to back the reappointment of Michael Roney, citing ESG failings as a top reason.
Roney, who is currently chair of the DIY business and fashion retailer Next, saw 21 percent of investors vote against his re-election at the AGM in May this year.
In a report released by the $2.3 bn company to determine why shareholders shifted their support away from Roney as chair, Grafton finds both climate and social reasons as causes.
Of the institutional investors that responded to an investigation by Grafton, two cite a lack of progress around setting net-zero targets or publishing Scope 3 greenhouse gas emissions data as problematic. A further two claim there is insufficient gender diversity on the board and at senior management levels, with one shareholder mentioning the number of board appointments Roney personally holds in listed companies, the report details.
Another shareholder expresses a personal view that the company ‘could and should have’ a better chair.
Taking climate change seriously
In response, Grafton says the group seeks ‘where possible’ to prioritize the appointment of women to leadership positions and is committed to increasing the representation of women in senior leadership positions.
‘Grafton has introduced initiatives to provide career development opportunities for female colleagues, including participation in management development programs, mentoring, coaching and flexible working arrangements,’ the report adds.
In the latest trading update, Grafton says it takes its climate change responsibilities ‘very seriously and will only set targets that it has a high level of confidence can be achieved’.
The DIY specialist says it is committed to setting science-based targets by the end of 2024 and is in the process of developing a transition plan to detail how the targets will be achieved and to monitor its progress.