Nationwide faces board challenge from member (The Times)
A campaigning customer has secured a board ballot spot for Nationwide for the first time in 21 years
By Ben Martin, Banking Editor
About nine million members of Nationwide will have the opportunity to elect one of their own to the board of the mutual for the first time in 21 years after a campaigning customer succeeded in making it onto this year’s ballot.
It is a significant step for James Sherwin-Smith, 45, a former consultant who has emerged as a vocal activist for shaking up the governance of Britain’s biggest building society in recent years.
He had tried to secure a place on last year’s ballot but his attempt to become a non-executive director failed when the customer-owned Nationwide ruled that some of the nominations he had received from members were invalid, meaning he fell short of the 250 threshold.
This time, Sherwin-Smith submitted 350 nominations and, even though the mutual disqualified more than 90 of them, he squeaked over the line with 256, putting him on the candidate list for election as a director at Nationwide’s next annual meeting in July.
Nationwide’s board must now decide whether to recommend to members that they vote in favour of Sherwin-Smith becoming a director, or advise against his election.
It is the first time that a member candidate has appeared on the Nationwide ballot since 2005, when Alan Debenham had his name put to a vote but failed to clinch a board seat. The last time a member-nominated individual actually made it onto the building society’s board was in 1993, according to Nationwide’s records.
Founded 142 years ago as the Southern Co-operative Permanent Building Society, Nationwide has become a giant of the mutuals movement, with more than 16 million members, although only 9.1 million are eligible to vote at its annual meeting. To have a say at the meeting, members must be 18 and have £100 in a savings or current account with the mutual, or owe the same amount on a mortgage.
Nationwide recently leapfrogged FTSE 100 bank NatWest to become the UK’s second biggest mortgage lender, after expanding its business by acquiring Virgin Money for £2.9 billion in 2024.
This deal was the first big strategic step undertaken by Dame Debbie Crosbie, the former TSB boss, since becoming chief executive of Nationwide in 2022 and helped to propel annual pre-tax profits at the building society to £2.3 billion in the 12 months to March last year.
Yet the takeover also caused friction with some of its members. This was because Nationwide did not give them a vote on the deal despite a campaign, supported by Sherwin-Smith, to allow members to have a say on the blockbuster acquisition.
Sherwin-Smith has since become a leading advocate for improving transparency at the building society and for strengthening the voice of members in its governance. Previously a management consultant at Oliver Wyman, where he focused on financial services, he went on to work in the payments industry.
Now he is on the Nationwide ballot, he wants the mutual to clarify how its members will be asked to vote.
For the last two decades, the only candidates for election and re-election to Nationwide’s board were individuals proposed and recommended by the building society. At the same time, the mutual has offered members a “quick vote” option to tick a single box to say they support all of the meeting resolutions recommended by Nationwide, to save them the trouble of reading and voting on each individual proposal.
If Sherwin-Smith’s candidacy is not recommended by the board, he is likely to be put at a disadvantage by the “quick vote” because his election would not be covered by it. He has therefore asked Nationwide to suspend the system so that members have to approve each resolution instead.
He said: “I think members should be given greater opportunity to pause and consider when there are alternative candidates on the ballot. Rather than just checking the single box at the top of the ballot, they should be invited to really consider the options because there is more choice this time.”
A spokesman for Nationwide said Sherwin-Smith would be on the ballot and that “the outcome will be determined by members’ votes in accordance with the rules”.
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