Former tech darling Reckon faces its own day of reckoning after receiving an unprecedented 70 per cent vote against its remuneration report on Wednesday.
It is the third consecutive strike the company has received against its remuneration report and suggests the board - which includes Reckon founder, Clive Rabie - might not survive a spill motion if another strike is recorded next year.
A 25 per cent vote against a remuneration report across two consecutive shareholder meetings is all that is needed for a spill motion to be triggered.
The astounding size of the votes in this case suggest investors, including institutional shareholders, are out for blood.
Unlike previous strikes - which led to the last spill resolution being easily defeated after last year's AGM - this is not about the Reckon board being able to exercise its discretion and vest long term incentives that had not met performance hurdles.
It is not hard to guess what would be top of mind.
Reckon's shares rocketed last year when Rabie, and chairman Ian Ferrier, called in the boys and girls from Macquarie Capital to "assess a range of strategic options for the company" after reported interest from private equity and trade players.
It came to nought, and the share price impact was compounded by the news this year that Reckon was going play an expensive game of catchup with the cloud-based accounting software leader, Xero.
The scene was set in March when Rabie, who still owns 10 per cent of Reckon, told his institutional investors to sell their stock if they did not share his long term vision for the company.
"It's a massive problem, the month-to-month valuing of their portfolio performance," Mr Rabie said this month of the short-termism affecting our fundies.
He also claimed that six boutique funds had taken a stake in Reckon over the last month, with a much longer-term perspective than large institutional funds.
Maybe they forgot to vote.
Got a tip for CBD? ckruger@fairfaxmedia.com.au
