Nationwide Building Society’s board achieved strong support at its annual general meeting, with resolutions passing by over 95% and rebel candidate James Sherwin-Smith securing just 12% of votes. While the society’s financial performance and customer satisfaction remain high, governance experts argue that members deserve more meaningful voting rights on key issues.
Modest rebellion at AGM
James Sherwin-Smith, campaigning to become the first member-nominated director in nearly 25 years, gained only 12% of votes cast. This fell far short of embarrassing the board, which saw other resolutions, including an advisory vote on directors’ pay, pass with 95% or more approval. Only about 600,000 of Nationwide’s 19 million members voted, reflecting low engagement.
Performance strong, but governance questioned
Nationwide’s financial performance is undeniably strong, and its customer satisfaction scores outpace shareholder-owned banks. However, critics point to governance shortcomings. The £2.9bn takeover of Virgin Money in 2024 did not require member approval under the 1986 Building Societies Act, despite expanding the society’s balance sheet by a third. Nils Pratley, writing for The Guardian, noted that “the building society rules need an overhaul” to give members a real say in such major transactions.
Non-binding pay votes and quick vote system
Nationwide continues to hold non-binding votes on executive pay, citing building society rules. CEO Debbie Crosbie received £4.7m in compensation, below Lloyds or NatWest levels but still substantial. Pratley argued that Nationwide could show leadership by making pay votes binding, aligning with the shareholder-owned banks it often criticises in advertising. Additionally, the “quick vote” system, allowing members to back all board resolutions with one click, was criticised by Sherwin-Smith for loading the dice against challengers, though it likely did not alter the outcome.
Incoming chair has opportunity for reform
Incoming chair Mike Rogers, former chair of Admiral and Experian, has a chance to review governance amid heightened political interest in mutuals. Pratley concluded that “membership ought to mean real votes on takeovers and boardroom pay.” While Nationwide does not need radical overhaul, strengthening member voting rights would align with its mutual ethos.
