REPORT ON ROYAL MAIL GROUP AGM – 23RD JULY 2015

REPORT ON ROYAL MAIL GROUP AGM – 23RD JULY 2015 

 

Further to LTB 476/15 which contained information for branches regarding the RMG AGM. Please find attached for your information a summary report from the meeting held the 23rd July in Cardiff.

 

In addition to the attached report a breakdown of the decision and voting on the various propositions consider at the meeting can be located via the following link.

 

Click to access Results%20of%20the%20AGM%2023%20July%202015.pdf

 

Any queries about the contents of this LTB should be addressed to the DGS (P) Department quoting reference LTB 499/15.

 

 

Yours sincerely

 

 

 

 

 

 

 

Terry Pullinger​​

Deputy General Secretary (Postal)​​

 

  

Royal Mail AGM, 23rd July 2015

 

Introduction

 

Royal Mail’s AGM 2015 was held on 23rd July in Cardiff. There were approximately one hundred people in attendance and the meeting lasted one hour, with most of the time dedicated to answering questions from shareholders. Chairman Donald Brydon and CEO Moya Greene opened the meeting with an overview of Royal Mail’s progress and future strategy, reflecting its annual report and financial statements 2014-15.  

 

Chairman’s report

 

Donald Brydon reported that he will be stepping down as Chairman on 1st September 2015 after six and a half years in the role, to be replaced by Peter Long who is currently a non-executive director. He called 2014-15 a ‘landmark year’ for Royal Mail – its first full financial year as a private company, in which it has faced the challenge of an increasingly competitive market. He said Royal Mail has been investing in improving its efficiency, growth and innovation, and that this is reflected in improved operating profits and increased margins.

 

Chief Executive Officer’s Report

 

Moya Greene reported that Royal Mail has been recognised as one of the UK’s most trusted brands, and that customer satisfaction had improved over the year. Operating profit in 2014/15 was in line with expectations largely due to attention to efficiency and cost control which had secured a better than expected 1% reduction in UK costs. She said that cost savings have a human face including job losses, and that Royal Mail would continue to work very closely with the unions to make these difficult changes.

 

Moya Greene thanked Donald Brydon for his work in helping to transform the company and said she was looking forward to continuing that transformation work with Peter Long. She noted Royal Mail’s success in achieving a 2.5% improvement in productivity over the last year and said the company is now poised to step up the pace of change and drive not only efficiency but also growth and innovation.

 

CWU Questions

 

There were five questions posed by local and regional CWU representatives on behalf of the union, as follows:

 

1. The CWU asked the board whether the company remained committed to the principles set out in the Agenda for Growth agreement in respect of maintaining decent employee terms and conditions post privatisation and in an increasingly competitive market.  

 

Donald Brydon replied that the company’s relationship with the union is now vastly improved to the credit of both management and the union. He said that a new phase of discussions with the union was beginning and therefore it would not be wise to expand on his comments in any detail. However, he said Royal Mail is proud that it pays people properly and does not use zero hours contracts and that is at the heart of what it wants to achieve.

 

2. The CWU asked how Royal Mail is going to ensure that the public continues to have a voice in how the postal service is run as the government prepares to sell off its remaining stake in the company.  

 

Donald Brydon responded saying that it is the government’s decision to sell Royal Mail, not the company’s, but he said that the way the public has a voice is as customers. He believes that customer influence is the strongest form of pressure people can bring to the company. He also said Royal Mail is proud to be the company selected to deliver the universal service obligation (USO).

 

3. The CWU asked whether Royal Mail supports the union’s People’s Post campaign to prevent cherry picking in the postal market and a race to the bottom on employment standards.  

 

Moya Greene answered by saying it would be wrong to impede the independence of the CWU’s view on its campaign, but that Royal Mail is on record saying that the USO is fragile and that the cherry picking of easy to serve areas means the financeability and sustainability of the USO will be threatened. She said the company agrees with the CWU’s position on cherry picking and is on public record with respect to that.

 

4. The CWU highlighted the unfair treatment of part time staff who regularly work beyond their contracted hours but are only paid their contracted hours as holiday pay. We asked the board how the company can justify this.

 

Moya Greene responded by saying the vast majority of its positions are full time but that the company needs some part time staff to provide a measure of flexibility due to the way the business is structured. She said Royal Mail offers the best pay and conditions in the industry and they are proud to do so because they enjoy the loyalty of their people. Moya Greene said she was not prepared to get into the detail of the issue, but that the company has ongoing meetings with the unions and if there is a concern it will be raised at those meetings.

 

The CWU followed up by saying that the issue does get raised locally but that nothing is done. Moya responded by acknowledging the point and indicating that it had been noted.

 

5. In light of a government review next year of the current USO, the CWU asked whether Royal Mail supports the existing minimum requirements of the USO and will not be calling for any reduction to those provisions.

 

Donald Brydon answered by stating that Royal Mail is not seeking a downgrading of the USO and that they are happy to be the company that delivers the USO. His answer was brief, saying he could not be any clearer than that.

 

Other questions from shareholders

 

A number of other questions were raised by shareholders that are of interest to the CWU.

 

 

• A private shareholder asked what Royal Mail’s strategy was to capitalise on the collapse of City Link and the poor rates of customer satisfaction in the courier sector. Donald Brydon replied that customer satisfaction at Royal Mail is rising and that its strategy is to improve satisfaction and quality further so that it can outperform its competitors.

 

• Another shareholder asked what consequences might result from Ofcom’s fundamental review of the regulation of Royal Mail. Donald Brydon answered that it was a matter for Ofcom to set out its plans. He said that Royal Mail is engaged in dialogue with the regulator on this issue but he did not offer any information or opinion on the potential outcomes of the review.

 

• The issue of executive pay was raised by one private shareholder who singled out Donald Brydon’s 2015 salary of £210,000 as being excessive, calling it a ‘disgrace’, particularly given the role was part time. He highlighted the disparity between pay on the board and that of part time staff at Royal Mail. Donald Brydon said that his pay and that of other board members is set by the remuneration committee, and he said it was standard practice for the Chair of a listed company to be a part time role.

 

• A shareholder who was also an employee said that in the area where he works there are a lot of ‘casuals’ employed at the company who were not properly trained in their role. He said that a commitment to training and development for these staff would be helpful. Moya Greene acknowledged the point and indicated she would give it some attention.

 

• A question was posed by an individual shareholder about why Royal Mail continued to provide first and second class delivery services when in their view it would be more efficient to simply provide one standard service. Donald Brydon responded that customers have made it clear they want both first and second class services and that Royal Mail will succeed by meeting customer needs.

 

• There was a question about whether it was prudent to use shareholders’ money to fund political donations. Donald Brydon replied that the company does not make donations to individual political parties but that the passing of Resolution 15 on what is legally termed ‘political donations’ would authorise Royal Mail to fund its political activities such as lobbying at party conferences.

 

Resolutions

 

Following questions, the Chair moved on to the resolutions which are set out in the Notice of AGM and recommended by the Directors as being in the best interests of the company and its shareholders. The results received from votes cast in advance of the meeting were displayed, with each resolution overwhelmingly supported. Individual shareholders present were asked to complete and hand in their voting cards after the meeting.

 

Donald Brydon then closed the meeting saying what a privilege it had been to be Chairman of Royal Mail, calling it an unusual company which was a real business combined with a real social purpose. He said he believed there was more ‘togetherness’ in the company today than there has been at any time.  

 

 

 

 

Orna Ni-Chionna, non-executive director, thanked Donald for his contribution saying that he had done what was right for the company and that it had been transformed for the better under his leadership.

 

Moya Greene, Peter Long and other members of the board made themselves available to the audience for questions over tea and coffee both before and after the meeting.

 

The results of the votes were published on the afternoon of 23rd July, with each resolution being carried. They are available at the following link:

 

http://www.royalmailgroup.com/sites/default/files/Results%20of%20the%20AGM%2023%20July%202015.pdf  

 

 

 

CWU

23rd July 2015