Momentous times for Macquarie Bank

It has been a huge day for business news with BHP-Billiton's Rio Tinto bid, the markets tumbling, CBA's interest rate belligerence and Macquarie Bank's regime change from Allan Moss to Nicholas Moore.

However, the big news on the corporate governance front is that from April 1 this year, the leadership team at Macquarie Bank will be on a far more appropriate profit-sharing scheme.

Macquarie has listened to the protest vote at last year's AGM and acted. Excessive cash bonuses based on short-term performance are out and longer term equity incentive schemes are in. See this Crikey report after the AGM for the context.

Rather than only 20% of the profit share being withheld in Macquarie instruments for up to 10 years, an additional 35% will be used to buy Macquarie Group shares that must be held for at least three years. See page five of the announcement for the specifics.

The change happens immediately for Moore and will be phased in progressively for the rest of the management committee. And isn't it interesting how the change came after co-founder David Clarke stepped down as executive chairman and become a non-executive chairman on a fixed $680,000 a year from April 1 last year.

The Macquarie protest vote in 2007 was one of 20 largest we've seen in Australia against an ASX 200 remuneration report and this has delivered an immediate change of policy that will see more than 90% of shares being voted in favour of this year's remuneration report.

There is no way this would have happened without Peter Costello's reform which gave us voting on remuneration report. How ironic that he is now rumoured to be headed into the Macquarie executive ranks on his return from overseas.

Well done to all concerned, especially Dean Paatsch and Martin Lawrence at proxy advising outfit Risk Metrics which recommended against the remuneration report and delivered the 21% protest vote.

Macquarie ran a big campaign against Risk Metrics, including this briefing document which was circulated to various institutional shareholders last July.

It didn't work and now they have changed their practices for the better. Well done Macquarie for acting promptly.

Allan Moss joins the legendary market movers club

Whether its a huge bouquet for Allan Moss or an equally large brickbat for Nicholas Moore, the record shows that the market hates this changing of the guard because Macquarie Group shares plunged 9% today after plunging $6.06 to $61.10.

This destroyed $1.66 billion of market capitalisation and is the biggest wipe-out of value that we've even seen at a major Australian company after an appointment.

Check out the full list here. Whilst a Kaz Computing board coup was worse, it was never a top 200 company. The next biggest collapse was the 8% plunge in Coles Myer shares on the day Phillip Bowman was fired way back in 1995, although you need to factor in today's 3% plunge in the broader market.

In terms of appointments that caused a big share price fall, Nicholas Moore is also top of the pops, although the only other big one we've noted was when PBL hired another Macquarie Banker in Peter Yates, causing a 6% share price route on March 28, 2001.

Allan Moss deserves to go out as an absolute Australian business legend. We've packaged up a few of our favourite exchanges with the lad over the years.

Let's just hope he chooses to write the tell-all book one day because the rise and rise of Macquarie Bank is one of the most remarkable business stories in Australia.

See more on the Financial Times blog Alphaville.

Listen to Stephen Mayne on ABC Radio National.