By James Langton

(January 12 – 13:20 ET) – Royal Bank has filed its proxy circular for fiscal 2000. The circular sets the bank’s annual meeting for February 23 at the Hotel Vancouver in Vancouver. In addition to the usual business of electing directors and other corporate housekeeping, the bank faces five shareholder proposals from shareholder activists.

The Association for the Protection of Quebec Savers and Investors Inc. (APEIQ), headed by Yves Michaud, has submitted a number of proposals for consideration. For example, he says that RBC does not do any business, other than audit work, with its external auditors to ensure their independence. Further APEIQ proposes that RBC adopt a cumulative voting procedure for electing directors, to limit the influence of major shareholders and ensure board diversity. Finally, all stock option plans should carry an exercise price, indexed to the change in the stock market prices of shares in the financial services industry thereby isolating management performance from
general industry performance.

Activist Bob Verdun has submitted two other proposals. First, short-selling of shares should not occur without the written permission of the beneficial owner. Second, the identity and general situation of “affiliated” and “related” directors should be disclosed to achieve fair and adequate disclosure — a policy that Bank of Nova Scotia adopted in 1999.

The bank recommends that shareholders vote against all of the proposals.

The Royal Banks proxy discloses executive compensation of the bank’s top executives. Again last year, it paid more to be a broker than a banker. Gord Nixon, head of RBC DS, was the highest paid executive at the bank, garnering an $8 million bonus in addition to his mere $302,000 salary.

Brokerage executives do not receive bank options, but Nixon, and his former boss, Tony Fell, did each receive $2.16 million in units awarded through the RBC DS Incentive Program. Fell, chairman of DS, received just $302,000 in salary too and no options, but he did receive deferred compensation based on a $6.5 million annual bonus.

Reay Mackay, head of the bank’s wealth management businesses, enjoyed a slight raise to $545,833 in salary, along with a more than doubling of cash bonus to $500,000, deferred units worth another $500,000 and 140,000 options.

For running the show, John Cleghorn received a slight raise to almost $1.1 million in salary, he picked up a $1.5 million bonus, up from $1 million last year, another $1.5 million in restricted shares and 400,000 options. Plus more than $86,000 in perks.