ABI disputes Myners' plan for investors

INVESTOR bodies last night launched a fresh attack on City minister Lord Myners, following his suggestion that shareholders should be able to buy and sell their voting rights.<br /><br />The comments from Myners are the latest in a string of radical proposals designed to increase shareholder power.<br /><br />&ldquo;Some shareholders who never vote could sell their voting rights to others who do want to vote,&rdquo; Myners said.<br /><br />&ldquo;That would introduce market discipline into voting. It would have to be limited. Voting could not go beyond two votes per share, say. It is quite complicated, but it&rsquo;s got merit.&rdquo;<br /><br />But last night the director of investment affairs at the Association of British Insurers (ABI), Peter Montagnon, hit out at the plan.<br /><br />&ldquo;Lord Myners is right to be asking what can be done to make companies more accountable to their shareholders, but this course is not the right one,&rdquo; he said, adding the government had not in the past helped to foster long-term ownership interests in UK companies.<br /><br />The ABI believes argues that the economic benefit of long-term share ownership for institutional investors has been hit badly by new regulations, solvency requirements and changes to taxation.<br /><br />&ldquo;We need to look more at long-term incentives for investing,&rdquo; Montagnon said.<br /><br />Earlier in the day, Myners urged Sir David Walker, who is leading the government&rsquo;s inquiry into corporate governance, to consider the move as part of a wide range of options aimed at making big business more accountable to investors.<br /><br />Myners has also previously suggested weighting shares to prioritise long-term shareholders over institutions such as hedge funds, which often enter and exit companies rapidly.