A group of public sector U.K. pension funds has called for a shareholder rebellion over poor governance practices at Belgian banking and life assurance group KBC. The move is part of the Local Authority Pension Fund Forum’s plan to take a tougher stance on governance issues at international companies.

The forum, whose 49 member funds have $110.3 billion under management, has long been an active voice on U.K. governance matters. But the financial crisis has convinced it to push foreign companies to improve their governance practices too.

Earlier this year it compiled a list of 15 companies where it felt governance could improve. So far it has gone public with its concerns about two of them: KBC and the U.S. financial company T Rowe Price. The forum only names those companies that, in its view, do not respond adequately to private overtures.

The forum’s concerns about KBC relate to remuneration. It is not clear how much executive board directors earn, there is no ceiling on bonuses, performance targets are not clear, and there is not enough independent representation on its remuneration committee, the forum says.

The forum said its chairman Ian Greenwood wrote to KBC with its concerns in February, but received no response. “KBC has not taken the opportunity to explain to us in more detail how their remuneration policy is meant to align management interest adequately with shareholder interest,” Greenwood said.

It wants its members to vote against two KBC proposals when the company holds its annual shareholder meeting on 30 April.

Topics