Shareholder watchdog wades into Alliance Trust board battle with call to back activist

The intervention is a blow for the current board in its battle with 12 per cent stake holder Elliott Advisors after yesterday attempting to bolster its position against the activist with a trading update that highlighted a share price rise above 500p for the first time last month and that recently hit an all-time high of 523p.

The report also included the news that the process of finding a “truly independent” director had been accelerated with the appointment of headhunter Russell Reynolds “to undertake a broad, transparent and rigorous search”.

However, Pirc said that the three non-executives nominated by Elliott and identified by search firm Spencer Stuart should be considered as independent.

The watchdog recommended that shareholders vote in favour of their appointment as well as advising investors to vote against the wealth manager’s pay plans when they gather for its annual meeting on 29 April.

It added: “It is considered that increased independent representation is a valuable safeguard against ‘group-think’ and that sufficient assurance has been provided on the independence and calibre of the candidates to merit their election.”

Pirc advised investors to vote against Alliance’s remuneration report due to concerns over the level of Garrett-cox’s total rewards in relation to her salary, and oppose its annual report at the meeting in Dundee on 29 April because there is no vote on the trust’s dividend policy.