UK Pension Group Accuses Barclays of “Misleading Shareholders” Over Executive Pay [UPDATE: Barclays Pay Chief Resigns]


UPDATE: On Tuesday, Barclays announced the resignation of Sir John Sunderland, chair of the bank’s pay review committee.

Barclays says the resignation was unrelated to pressure from the LAPFF, who publicly called for Sunderland’s resignation on Monday.

The bank has been criticized by the LAPFF and others over high bonuses and compensation.

Read the original Pension360 story, published on Monday, below.


The UK’s Local Authority Pension Fund Forum (LAPFF), a group of 62 public sector pension funds, is taking Barclays to task for failing to replace the chairman of the bank’s pay review committee.

LAPFF, a group that has previously expressed outrage over bank’s “grossly excessive bonuses”, is now saying that the bank promised to replace the chairman of its pay review committee.

But 11 months after the promise, no change has been made.

More from BBC:

A leading pension body has called for the immediate resignation of Sir John Sunderland, chair of Barclays’ pay review committee.

It accuses the bank of “misleading shareholders” for saying before the 2014 annual general meeting (AGM) that Sir John would step down from the role to give way to Crawford Gillies.

Sir John is still in the post 11 months later, the LAPFF says.

Barclays declined to comment on the resignation call.

Barclays was widely criticised by shareholders for its pay policy at the 2014 AGM.

In a strongly worded statement, LAPFF chair Kieran Quinn said: “It is inexplicable how Barclays can have gone back on its promise to the 2014 AGM that Sir John would step down.

“Having messed up remuneration for 2013 Sir John has in fact stayed on as chair and presided over another year of still unacceptably high pay for 2014, and is still in place in March 2015.

“It’s nothing short of misleading shareholders.”

Mr Quinn went on to say that Sir John’s involvement in awarding “grossly excessive bonuses” and his support for former chief executive Bob Diamond, amongst other things, had been “disastrous for shareholder returns and the reputation of the bank”.

The LAPFF represents pension funds with collective assets under management of over $240 billion.


Photo by Roger via Flickr CC License

Pension Funds Sue Exchanges Over High-Frequency Trading

stock exchange numbers and graphs

A handful of pension funds have joined a lawsuit against Nasdaq and other major stock exchanges, alleging that the exchanges favored high-frequency traders and in the process hurt other investors, including pension funds. From the New York Times:

The pension funds, including one in Boston and another in Stockholm, have joined a lawsuit originally filed by Providence in April, according to a filing in U.S. District Court in New York last week. They are taking aim at some of the biggest stock exchanges – including the New York Stock Exchange, Nasdaq and BATS Global Markets – as well as the investment bank Barclays, which operates a private stock trading venue known as a dark pool.

Their legal action comes during a period of heightened scrutiny for high-frequency traders, which use computer algorithms to buy and sell shares in milliseconds. In recent months, Washington lawmakers have summoned financial executives to testify about high-frequency trading, the Securities and Exchange Commission has stepped up its scrutiny of the practice, and the New York state attorney general, Eric T. Schneiderman, has sued Barclays over high-frequency traders in its dark pool.

The pension funds and Providence, which are seeking class-action status, claim the exchanges ran afoul of their legal duties by providing certain advantages to high-frequency traders, “diverting billions of dollars annually from buyers and sellers of securities and generating billions more in ill-gotten kickback payments.” They are seeking an unspecified amount of damages.

Spokesmen for the defendants, which also include the Chicago Stock Exchange, all declined to comment.

Stock exchanges offer a number of paid services used by high-frequency traders, including detailed data feeds, special types of orders and the ability to place computer servers in the exchanges’ data centers. The lawsuit argues that such practices hurt other investors, and it claims the exchanges have a “financial incentive to create an uneven playing field.”

The pension funds that joined the lawsuit include the Employees’ Retirement System of the Government of the Virgin Islands; the State-Boston Retirement System; the Plumbers and the Pipefitters National Pension Fund in Alexandria, Virginia.


Photo by Terence Wright via Flickr CC License