“During the year, the Board received feedback from one proxy adviser firm outlining concerns regarding Helia's practice of providing shares in lieu of dividends foregone on vested shares.
“The Board engaged with proxy advisors to understand key concerns around the provision of notional dividends on vested LTI rights. After careful consideration, the Board determined the current approach remains fit for purpose as it:
“Meets our remuneration principle to align executives with shareholders. Notional dividends provide a one-to-one alignment with actual dividends paid, and it is difficult to replicate this through other approaches.
“Incentivises management to explore all options to return excess capital through special dividends and share buy-backs. This is an important expectation of the Board and shareholders given Helia's excess capital.
“Is the simplest and most transparent - with notional dividends provided as equity rather than cash reflecting better practice and avoiding any discounting methodologies which lacks transparency.
“Negates the difficulty in forecasting special dividends which are discretionary and vary from time to time.
“Lastly, it is not uncommon market practice, with a number of ASX listed organisations providing notional dividends delivered as equity.”
HLI Price at posting:
$4.85 Sentiment: Buy Disclosure: Not Held
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