13 questions asked at 2022 Lend Lease AGM

November 19, 2022

Here is the text of the 13 written questions asked at the 2.5 hour 2022 Lend Lease hybrid AGM held on November 18 with a summary of the answers and some videos links.

1. Did any of the 5 main proxy advisers - ACSI, Ownership Matters, Glass Lewis, ISS and ASA - recommend a vote against any of today's resolutions, including the election of Nick Collishaw? Has there been a material proxy protest vote against any of today's resolutions? Will you disclose the proxy votes before the debate on each resolutions so shareholders can ask questions about the reasons if there have been any protest votes? Also, why not disclose the proxies to the ASX with the formal addresses like others now do?

Answer: they were all in favour.

2. Tony Watson was the primary external tax adviser to Lend Lease for 20 years but then turned whistleblower against the company over an ATO tax investigation which has been dragging on for years. Could the chair and CEO please summarise precisely what is in despite, whether we have treated Mr Watson fairly and what is the likely timetable for this matter to be finally settled, both with Mr Watson and the ATO.

Answer: chair gave a detailed response noting the publicity, importance of the case and the publicity. Watch video via Twitter.

3. Thank you to Jane Hemstritch for her long contribution to the board. As her final public contribution before retiring from the board at the conclusion of today's meeting, could Jane comment on the three things she is most proud of about Lend Lease's performance during her time on the board and any regrets she might have.

Answer: most proud of global accounting systems, safety and sustainability progress and declined to answer regrets question. Watch video via Twitter.

4. When disclosing the outcome of voting on all resolutions today, including the remuneration report, could you please advise the ASX how many shareholders voted for and against each item, similar to what happens with a scheme of arrangement? This will show respect for retail shareholders and provide a better gauge of retail sentiment on all resolutions and was a disclosure initiative adopted by the likes of Metcash, Altium and Dexus last year and Webjet and Tabcorp so far this AGM season. Also, the annual report says out total shareholder numbers dropped from 70,148 to 65,944 over the past 12 months. Were there particular brokers that had a sell recommendation on Lend Lease?

Answer: we'll look at it. Chair was right that falling shareholder numbers were totally irrelevant to the rem report discussion.

5. Michael Ullmer joined the board in 2011 and has been chairman for 4 years. Is he intending to retire when his current term expires, particularly given his length of service and the recent poor performance, and does Michael believe the next chairman is currently on the board?

Answer: that's a private board matter.

6. One of Nick Collishaw's most recent public company roles was as chairman of Redcape Hotels Group, Australia's second largest listed poker machine operator, with a concentration of venues in western Sydney. On October 26, the NSW Crime Commission released a damning report about money laundering through poker machines in NSW pubs and clubs. Could Nick Collishaw comment on his personal approach to ESG, including how he dealt with the risks of poker machine money laundering when he chaired Redcape, which was privatised in 2021. Given the chair was also a long term director of Woolworths when it was the largest poker machine operator until the 2021 Endeavour Group demerger, could he also comment on what steps he took to mitigate money laundering in the Australian gambling industry and whether the Crime Commission report surprised him.

Answer: chair batted away pokies questions as not relevant. Fair enough.

7. When a major project is blowing out and their are high stakes negotiations with governments, partners and sub-contractors, such as what occurred with the Metro Tunnel project in Melbourne, how does the board balance the approach between fully disclosing the situation to the market and preserving its negotiating position. As an independent director, could David Craig comment on when and how the board gets involved in these decisions. What are the monetary delegation levels under which management can settle a dispute without seeking specific full board approval.

8. Aware Super is Australia's third biggest industry fund managing $125 billion, primarily for NSW public sector and workers in the health industry. The Lend Lease annual report discloses that they are our largest shareholder with 8.56%, ahead of the 3 big global index funds - Blackrock, Vanguard and State Street- which each own just above 6%. This is a very unusual situation for an industry fund to go so heavily into one stock, in this case to the detriment of NSW public servants given Lend Lease shares have fallen from a peak of more than $20 in 2019 to less than $8 today. What is the history of Aware Super's huge investment in Lend Lease and how does our engagement with them differ from our engagement with the big global index funds which are normally too widely invested to bother meeting with individual companies.

Answer: chair gave a long answer explaining that Aware was a wholesale partner in many projects around the world, including Barangaroo. Interesting. Watch video via Twitter.

9. Margaret Lui was announced as a director on September 28 and the ASX announcement said that she would be standing for election at today's AGM, but not formally joining the board until December 1. As a lawyer, could Nicola comment on why Margaret wasn't put up for election today when we initially said that she would be? Was it something to do with how many directors have to be elected each year and who was up for election? Also, what was the recruitment process for Margaret's appointment. Was a head hunter involved and did the board interview multiple candidates?

Answer: I botched this because the ASX announcement said she'd be elected next year. However, rather than taking the "get your facts right" defence, the chair could have explained why she wasn't put up this year.

10. Chair, the proxies screen was not visible for those watching online. Please read out the percentage in favour figure. Given the lack of debate, surely you can now see the benefit of early proxy votes disclosure to the ASX providing timely advice to all 65,000 shareholders, rather than this straw man argument that advising the ASX early is somehow inhibiting debate at the AGM. More than 99% of voted stock is down by proxy ahead of time, so this comparison with postal and election day political voting is not valid. As board candidates, you already have the data, unlike politicians. Please share it across all platforms in a timely manner.

Answer: chair promised to read out the proxies and said we needed to agree to disagree re early proxies. Watch video via Twitter.

11. Could the CEO summarise his past LTI grants as to whether they have vested or lapsed. Also, has he ever sold any ordinary shares in the company or bought any on market without relying on an incentive scheme to build his equity position in the company? Please don't say look it up in the annual report and through ASX announcements. It's complicated and the CEO could factually summarise the situation in 30 seconds.

Answer: chair took too many of the questions and arguably took too long explaining each issue, as occurred on this one. However, when given the chance, CEO Tony Lombardo demonstrated he was right across the situation. Watch video via Twitter.

12. There was a 10% vote against the rem report despite all proxy advisers recommending in favour. This is very unusual. Voting is not a secret ballot for the directors. Are you Aware you voted against. Was it Aware Super? Has a similar protest vote been lodged on the LTI grant and what was the issue that drove the rem protest vote.

Answer: chair was probably right in his assessment that some shareholders lashed out on rem based on the falling share price.

13. Final question. Thank you for reading out all my questions without censorship today. Chair, you performed well in difficult circumstances and are clearly across the brief. Well done last year for producing your first AGM transcript, in addition to publishing an archive of the webcast. Will you do this again this year?

Answer: Yes, we aim to be transparent and will do it again this year. Thank you for the compliment. Watch video via Twitter.