Fund managers support corporate governance
Perennial Investment Partnersyesterday signalled it will continue to be active in representing investor interests on corporate governance, a stance coinciding with the release of a survey by theInvestment and Financial Services Association(IFSA) at its annual conference in Cairns indicating fund managers are increasingly voting proxies.
The 2003 survey of fund manager voting patterns released by IFSA yesterday revealed fund managers are voting on 92 per cent of all resolutions, up from 67 per cent of resolutions in last year's survey.
Perennial Value Management managing director John Murray has acknowledged Perennial’s recent high profile with respect to shareholder issues and says this is a stance the boutique fund manager will continue to pursue.
Murray’s vow to remain active in terms of shareholder interests follows on from Perennial’s involvement in a move by institutional investors earlier this year to force Village Roadshow to pay dividends on its preference shares.
“We have more muscle than ordinary investors and we have an obligation as fund managers to show some leadership,” he says.
Murray’s comments came as Perennial signalled it is positioning for an improving investment outlook based on the rebound in the US economy.
Perennial’s investment strategist Frank Uhlenbruch told a media briefing that the emerging strength in the US economy and the lessening likelihood of deflation explain Perennial’s strategic positioning.
“It explains why we are short in fixed interest,” he says.
Uhlenbruch says notwithstanding some recent strengthening in bond prices, the outlook appears favourable for both international and domestic equities.
He says that over the past six to eight weeks all the data out of the US has been broadly positive and indicates a good second half of 2003-04.
Further, Uhlenbruch says that while growth in Australia is slowing, the improving situation in the US will have definite benefits for Australia.
He says that while the housing sector is slowing, the drought is breaking and that the strengthening US economy will benefit Australia’s exporters.
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