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James Moore: Shareholders' rebellion was a long time coming

Outlook After a spring when most institutional shareholders appeared to be sleeping, a remuneration report has at last been defeated.

Mind you, events at Afren should have woken up even the most lackadaisical of institutional investors when it comes to governance.

The oil explorer, which has form on this issue and boasts a place in the FTSE 250, meaning you and your pension funds may be investing in it through tracker funds, faced defeat in 2011 on its remuneration report while 29 per cent of shareholders still voted against last year despite promises to do better. There was a near defeat in 2009, too.

In this case it might not just have been a remuneration report filled with a combination of high headline rewards, complex share schemes and a hefty dose of self-justification that sparked a rebellion which saw nearly 80 per cent of investors voting against.

It is personal stakes in Afren's part-owned Nigerian venture held by top management which will net them fortunes on paper. Pointed questions have been raised about the disclosure of them.

Yet again we see here a resources company that has come to London to benefit from both its prestige and its deep pool of capital, but which feels it can thumb its nose at best practice.

Afren has put forward a marvellous argument for making advisory votes on pay binding.

In the meantime, more shareholders should follow the lead of those who used their votes to take aim at the company's directors.