Stunning shareholder support for union resolutions at Rio Tinto AGM
A press release issued by the CFMEU following the Rio Tinto AGM of shareholders held in Brisbane last week says that trade unions have won substantial shareholder support for their position within Rio Tinto in an unprecedented display of shareholder activism. In voting results released recently by mining giant Rio Tinto, it was disclosed that two union-backed resolutions won the support of around 20% of shareholders. The first resolution, on improved corporate governance, attracted 20.3% (113.8 million) of shares voted. The second resolution, on company compliance with international human rights standards in the workplace, won the support of 17.3% (95.4 million) of shares voted. The vote for the second resolution is especially impressive as it is an issue beyond conventional shareholder concerns. It reflects increasing awareness of the human rights implications of company operations. International campaign The shareholder campaign was a cooperative effort of trade unions in Australia, Great Britain, the United States and South Africa, as well as other trade unions internationally. It was the first ever proxy vote campaign conducted on an international basis by trade unions. "Union involvement in shareholder activism in Australia has come of age with this result" said CFMEU National Secretary John Maitland, who is also President of the International Federation of Chemical, Energy, Mine and General Workers Unions (ICEM). "The board unanimously opposed our resolutions, and disparaged our efforts. But they can't ignore this result. "The issues raised by us were ones of genuine concern to shareholders. Rio Tinto's corporate governance practices aren't up to scratch and don't protect shareholders' interests as much as they should. And it is clearly the case that many investors saw no good reason why the company couldn't comply with international minimum human rights standards in the workplace." John Maitland noted that, at the Brisbane AGM, Chairman Robert Wilson and Chief Executive Leigh Clifford both expressed a desire to achieve peace and reconciliation with trade unions in Rio Tinto's operations. Robert Wilson, spoke of "reconciliation" with the company's union employees. "I look forward to those sentiments being made tangible in the near future in negotiations with the company", said John Maitland. "We are witnessing a new era of action by trade unions within the heartland of business." CFMEU General President, Tony Maher, also welcomed the remarks by the two Rio Tinto chiefs and said he was "particularly pleased to hear the Chairman, Mr Wilson, admit to shareholders that the company had made mistakes in the past in employee relations. If Rio Tinto matches it's rhetoric at the AGM with action at it's operations, the time is now ripe for the unions and the company to go forward together in a mutually beneficial relationship", said Tony Maher. ACTU Secretary Greg Combet said that "companies like Rio Tinto should recognise that working people and their families have become important and influential members of the investment community. That influence is beginning to be used internationally to send a message to companies like Rio Tinto that as investors in the company and as members of the global community, we expect them to adopt basic minimum labour standards." The resolutions called on Rio Tinto to adopt United Nations ILO standards. ILO signatories commit themselves to basic principles such as the abolition of child labour, the implementation of equal pay, the recognition of trade unions and the right of employees to bargain collectively. Disappointment At the same time, the CFMEU expressed disappointment with the Board's rejection of a shareholders' resolution calling for improved corporate governance standards. This resolution was supported by a number of institutional investors. It was moved by the President of the Australian Institute of Superannuation Trustees, Ms Susan Ryan, and supported by the representative of the Australian Shareholders Association attending the AGM, Mr George Bissell. Tony Maher said that the shareholder campaign would continue until Rio Tinto adopted the corporate governance standards expected of it.