director

Following the announcement to my professional network on LinkedIn regarding next week’s oral hearing, which linked to the text provided by the FCA, one commentator asked me this:

“Why do you need access to the full list (lots of personal data), rather than having Nationwide post out your election comms to the members directly?“

Question posted on LinkedIn

It’s a great question, and so I have pasted my answer back here, broken into sections with evidence in support of my arguments..

Access to the register is necessary in my opinion (the FCA is expected to determine this after the hearing next week) to secure nominations to be on the ballot, and to raise awareness of my candidacy ahead of it.

If I am nominated, members will then receive an election pack including information about the candidates, which would then include me.

22. Notice of Meetings and Postal Ballots
(a) Any notice of meeting shall:
…
(v) be accompanied in the case of an election of Directors by any election
address of not more than 500 words or other details concerning the
candidates required by the legislation;

Nationwide Memorandum and Rules (1 September 2024)

However, turnout for the elections / AGM is very low. Less than 4% of eligible members vote.

The most for and against votes recorded was for Debbie Crosbie:

Votes for 613,561 (96.1%)
Votes against 24,915 (3.9%)
Votes withheld* 7,051

Nationwide 2024 AGM results

Votes for + against = 638,476, which is less than 4% of the 16+ million members eligible to vote.

Member attendance at the virtual only AGM was just 300 people last year. This historically low level of member engagement is the principal reason for my candidacy.

See this extract from the 2024 AGM transcript – where the chairman replies to member’s question on AGM attendance. It’s perhaps worth noting that 2022 was during the COVID-19 pandemic.

How can we justify saying an online-only AGM gets ten times as many
members to join compared with an AGM of the past? He said I mentioned 194
being online today – I did say that indeed, we’re actually now about 300 people
online – yet a physical AGM held at the ICC in Birmingham around 2005 had
around 700 people in attendance.

Question from Mr Castle, a Nationwide Building Society member, at the 2024 AGM

I wasn’t here in 2005 but I’m very happy to take your number, Mr Castle. What I do
know is the last time we invited people to attend in person was in 2022 and we only
had 32 people that turned up in person, apart from our own staff. So back in 2005 we
didn’t have the same options for online meetings as we do now and so we are of the
view that in the current environment, with the better technology that exists now that
wasn’t nearly as good in 2005, this is giving us high attendance for our AGM. So
I hope that explains the difference.

Answer given by Kevin Parry, Chairman of the Nationwide Building Society, at the 2024 AGM

And most members choose to use the “quick vote” mechanism which means the board recommended candidates and resolutions are typically passed at a 95%+ approval rate.

Data from past Nationwide AGM results (2006-2024) shows that the approval rate (blue line, right hand axis on the graph below) has only once dipped below 95% for a board candidate. The number of votes cast however, has been reducing over time (red bars, left hand axis), from over 1.5 million in 2008 to 0.6 million in 2024.

This trend of fewer votes is opposite to the increasing number of members eligible to vote. There are currently 16+ million members of the society – 20 years ago it was 11+ million members , and in 2008 it was 14 million (see corresponding year’s annual reports).

Put another way, member turnout was 1.5 / 14 million = 11% in 2008, whereas in 2024 it was just less than 4%.

I need 250 nominations to be on the ballot, from eligible members.

The bar for nominations was raised 5x (i.e. from 50 to 250) by Statutory Instrument 1999 No. 3032, The Building Societies (Nominations for Directors’ Election) Order (1999), following the various attempts to de-mutualise the building societies in the 1980s and 90s. [Nationwide came close at the 1997 AGM, when Resolution 3 “To take steps to convert to PLC status” was defeated by just 33,710 votes (For: 1,101,887 votes, Against: 1,135,597 votes), i.e. 49.25% for vs. 50.75% against the resolution.]

31. Nomination for Election of Directors
(a) Any individual who will be at least 18 years of age at the date of election and is not
prohibited by law from being a director may be nominated for election as a Director.
(b) A nomination for election as a Director may be made by 250 qualified two year
members. The nomination must:
…

Nationwide Memorandum and Rules (1 September 2024)

The eligibility criteria and nomination process make it difficult, arguably impossible, to find the right members, in sufficient volume, through other methods.

It’s perhaps worth noting that, as per the graph below:

• Directors of the society were elected to three year terms until 2011, now Directors have to be re-elected every year. (Red bars below show successfully elected Board Appointed Directors.)
• There hasn’t been a single Member Supported candidate on the ballot since 2005. (Yellow bars signify unsuccessful Member Support candidates)
• The last Member Supported candidate to be successfully (re-)elected was in 2001 (Green bars) – this was Paul Twyman, who served on the board of the Anglia (pre-merger) and Nationwide for 20 years.
• Board Appointed candidates have been unseated by successful Member Supported candidates in the past as part of a competitive election (Blue bars): Michael Holloway was unseated by Sheila Heywood in 1988; and Sir Leonard Peach was unseated by David English (a former Nationwide manager who was made redundant) in 1993. Learn more about the Member Supported candidates in my post: Rebels with a cause: Standing on the shoulders of giants.

More info here on the criteria, form etc: james4nationwide.co.uk/nominate

Please don’t hesitate to contact me directly if you would like to discuss further.