6 questions lodged at 2023 Orica AGM

December 29, 2023

Below is the text of the 6 written questions lodged at the 2023 Orica hybrid AGM held on December 13, along with a summary of the answers and some video grabs via Twitter. No early disclosure of the proxies and no protest votes but disappointing Q&A dealt with as one job lot. That said, the 45 minutes of debate was good with about 8 shareholders participating online and in the room. Watch webcast archive of 1 hour and 44 minute meeting.

Q1. Is Malcolm Broomhead committed to serving a full 3 year term as Orica chair through until December 2026, when he will be 74? Also, does he believe the next Orica chair is currently on the board? What is the process in terms of the other directors doing Malcolm's annual performance review and could Malcolm detail the extent of his relationship with our 2 largest and most active shareholders, Australian Super (which owns 14.15%) and Cooper Investments which is led by active investor Peter Cooper.

Answer: The question was edited back a little and the chair referred to a loose 10 year tenure limit and effectively committed not to run again in 2026. Came back to the shareholder relationship question later and never got to the issue of who reviews his performance. His silliest answer of the day was that all of the current directors could be chair. Flattery clearly has got him a long way. Watch video via Twitter.

Q2. Under the Orica constitution, external nominations for the board must be lodged between 45 & 90 business days before the AGM. With a rushed pre-Christmas AGM on December 13, the latest nomination date this year was October 11. However, Orica didn't release its full year results until November 9 and the notice of meeting was released on November 13. Will Malcolm agree to return to a late January AGM in future so that board nominations close after you've told shareholders about your performance for the year. Why the rush?

Answer: All we got was commentary about how convenient it was for staff to get the AGM done and then enjoy Christmas and how annoying it was to do late January. Well then go with late February. These 168 companies held their 2023 AGM on November 30, the last day possible. Watch video of answer via Twitter.

Q3. Could the two new directors up for election today, Mark and Vanessa, along with the chair, please comment on the recruitment process that led to their appointments to the board. Was a head hunter involved and did the full board interview any other candidates? Did Mark or Vanessa know any of our directors before engaging with the recruitment process?

Answer: Because all resolutions were dealt with as one job lot, the two new directors didn't comment and the chair said they did have a head hunter and did interview other candidates. He didn't address the "relationships" question when the answer would have been yes, given there is a common directorship at Lynas. There's nothing wrong with knowing some directors but important to mitigate against mates being appointed, as opposed to merit and skills driving the call. Watch video of exchange via Twitter.

Q4. In 2019, Treasury Wine Estates voluntarily moved to annual elections for directors in line with best practice in the US & UK. Dual listed companies like News Corp & Rio do this due to the US & UK laws & BHP has continued doing it even after its UK DLC ended in 2021. Can John Beevers, as 1 of our longer serving directors, along with the chair (a former BHP director) comment on whether they will examine the prospect of Orica following this TWE lead & moving to annual director elections at the next AGM, hopefully in January 2025.

Answer: Malcolm said it worked fine at BHP but Orica would not be making the change. Have made zero progress in terms of actually securing a change in practice over the past 3 years. Watch video of exchange via Twitter.

Q5. 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 60 seconds.

Answer: The CEO initially said "no, no and no" and then explained it which succinctly answered the question. Unfortunately, the question wrangler censored the "don't say look it up in the annual report" bit and then the CEO said "look it up in the annual report". Watch video of exchange via Twitter. Quite amusing, all round.

Q6. Thank you for giving shareholders a say on climate. When disclosing the outcome of voting on all resolutions, could you please advise the ASX how many of our 35,000 shareholders voted for & against each item, similar to what happens with a scheme of arrangement? This will provide a better gauge of retail shareholder sentiment and was a voluntary disclosure initiative adopted by the likes of Metcash, Dexus, Webjet, Tabcorp, Myer, ASX and Qantas over the past 3 years. You've got the data, so why not let the sun shine in?

Answer: Old school chair Malcolm Broomhead couldn't see the point of doing this. Disappointing that the question wrangler failed to read out the precedent companies who do this, reducing the effectiveness of the question. Overall, she faithfully read most of them out without editing. Watch video of exchange via Twitter, which start with him returning to an earlier question on big shareholder relationships.

Also recommend watching this 2 minute explanation from the CEO on why they have invested more than $50 million decarbonising their Australian plants.