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There is concern that Telecom shareholders are focusing too closely on executive pay packets rather than fundamentals such as earnings outlook.
Business commentator Brian Gaynor on Tuesday said the Telecom annual meeting last week was taken over almost entirely by discussion of Telecom CEO Paul Reynolds' $5 million salary package.
The full salary was paid despite an almost 44% drop in full-year profit to $398 million. Telecom defended its position saying the company needed world class leadership as the company looked to transform itself.
Gaynor says there was very little mention of earnings prospects in either Telecom's shareholders' review or annual report.
"The speeches given at the annual meeting were very ra ra 'we're on the right track and we're doing well' but almost nothing about how the company has performed this year and how they expect to perform in the year ahead," he says.
Gaynor says shareholders have also been focused on the election of certain directors to the Telecom board.
Instead, he says shareholders should be asking how the company is performing so far, what its current outlook is, and what the dividend is going to be.
"Dividend is very important for a company like Telecom because it's got a lot of small shareholders who've invested in the company," says Gaynor
Gaynor says if shareholders in general neglect earnings
outlooks, they could end up focusing on the wrong things in the
upcoming annual meeting season.
