Burford Capital Limited Additional Definitive Proxy Soliciting Materials
Burford Capital is responding to an ISS recommendation against the re-election of two directors, Christopher Halmy and Robert Gillespie, to its Board of Directors. ISS based its recommendation on concerns about ineffective internal financial reporting controls since 2021. Burford argues that ISS has conflated two separate issues: the SEC-driven modifications to valuation approach and the current material weakness in financial controls.
The company emphasizes that Glass Lewis supports both directors' re-election and highlights their significant contributions, including overseeing Burford's NYSE listing in 2020 and the successful transition to US GAAP reporting. The company also addresses ISS's recommendation against executive compensation, defending its use of carried interest allocations as a method to align management and shareholder interests.
Burford Capital risponde alla raccomandazione di ISS contraria alla rielezione di due membri del consiglio di amministrazione, Christopher Halmy e Robert Gillespie. ISS basa la sua posizione su preoccupazioni riguardo a controlli interni inefficaci nella rendicontazione finanziaria dal 2021. Burford sostiene che ISS abbia confuso due questioni distinte: le modifiche al metodo di valutazione richieste dalla SEC e la debolezza materiale attuale nei controlli finanziari.
L'azienda sottolinea che Glass Lewis supporta la rielezione di entrambi i direttori e mette in evidenza il loro contributo significativo, incluso il coordinamento della quotazione di Burford al NYSE nel 2020 e il passaggio riuscito al reporting secondo US GAAP. Inoltre, l'azienda risponde alla raccomandazione di ISS contraria alla remunerazione degli executive, difendendo l'uso delle allocazioni di carried interest come metodo per allineare gli interessi della direzione con quelli degli azionisti.
Burford Capital responde a la recomendación de ISS en contra de la reelección de dos directores, Christopher Halmy y Robert Gillespie, para su Junta Directiva. ISS fundamenta su recomendación en preocupaciones sobre controles internos financieros ineficaces desde 2021. Burford argumenta que ISS ha confundido dos asuntos distintos: las modificaciones en el enfoque de valoración impulsadas por la SEC y la debilidad material actual en los controles financieros.
La compañía enfatiza que Glass Lewis apoya la reelección de ambos directores y destaca sus contribuciones significativas, incluyendo la supervisión de la cotización de Burford en la NYSE en 2020 y la exitosa transición al reporte bajo US GAAP. La empresa también responde a la recomendación de ISS en contra de la compensación ejecutiva, defendiendo el uso de asignaciones de carried interest como método para alinear los intereses de la dirección con los de los accionistas.
Burford Capital은 이사회 이사인 Christopher Halmy와 Robert Gillespie의 재선에 반대하는 ISS의 권고에 대해 대응하고 있습니다. ISS는 2021년부터 비효율적인 내부 재무 보고 통제에 대한 우려를 근거로 권고를 제시했습니다. Burford는 ISS가 SEC 주도의 가치 평가 방식 변경과 현재의 재무 통제 중대한 약점을 혼동했다고 주장합니다.
회사는 Glass Lewis가 두 이사의 재선을 지지하며, 2020년 Burford의 NYSE 상장 감독 및 미국 회계기준(US GAAP)으로의 성공적인 전환 등 그들의 중요한 기여를 강조합니다. 또한, 경영진 보상에 반대하는 ISS의 권고에 대해, 경영진과 주주의 이익을 일치시키는 방법으로서 캐리드 이자 할당 방식을 방어합니다.
Burford Capital répond à la recommandation d’ISS contre la réélection de deux administrateurs, Christopher Halmy et Robert Gillespie, au conseil d’administration. ISS fonde sa recommandation sur des inquiétudes concernant des contrôles internes financiers inefficaces depuis 2021. Burford soutient qu’ISS a confondu deux problématiques distinctes : les modifications apportées à la méthode d’évaluation sous l’impulsion de la SEC et la faiblesse matérielle actuelle des contrôles financiers.
La société souligne que Glass Lewis soutient la réélection des deux administrateurs et met en avant leurs contributions significatives, notamment la supervision de l’introduction en bourse de Burford au NYSE en 2020 et la transition réussie vers la comptabilité US GAAP. Elle répond également à la recommandation d’ISS contre la rémunération des dirigeants, en défendant l’utilisation des allocations de carried interest comme moyen d’aligner les intérêts de la direction et des actionnaires.
Burford Capital reagiert auf eine Empfehlung von ISS, die Wiederwahl von zwei Direktoren, Christopher Halmy und Robert Gillespie, in den Vorstand abzulehnen. ISS stützt seine Empfehlung auf Bedenken bezüglich ineffektiver interner Finanzkontrollen seit 2021. Burford argumentiert, dass ISS zwei separate Themen vermischt hat: die von der SEC veranlassten Änderungen der Bewertungsmethode und die aktuelle wesentliche Schwäche in den Finanzkontrollen.
Das Unternehmen betont, dass Glass Lewis die Wiederwahl beider Direktoren unterstützt und hebt deren bedeutende Beiträge hervor, darunter die Überwachung der NYSE-Notierung von Burford im Jahr 2020 sowie den erfolgreichen Übergang zur US-GAAP-Berichterstattung. Zudem geht das Unternehmen auf die Empfehlung von ISS gegen die Vergütung der Geschäftsleitung ein und verteidigt die Verwendung von Carried-Interest-Zuweisungen als Methode zur Angleichung der Interessen von Management und Aktionären.
- Successful transition to US domestic public company status with first Form 10-K filing in March 2025
- Over 80% of trading volume now occurs in the United States
- Successful modification of valuation framework through SEC engagement
- Current material weakness in financial controls relating to fair value measurement process
- ISS recommendation against executive compensation structure
- Ongoing concerns about internal control over financial reporting
Insights
Burford challenges ISS's director opposition based on material control weaknesses, provides context distinguishing past valuation issues from current documentation problems.
Burford Capital is pushing back against ISS's recommendation to vote against two directors over internal control weaknesses. The company makes a factual correction that Christopher Halmy wasn't on the board in 2021 when some issues began, undermining part of ISS's rationale. Burford distinguishes between past valuation approach modifications and the current material weakness in controls, which relates specifically to "a lack of available evidence to demonstrate the precision of management's review" in fair value determinations.
Critical to understanding this situation is Burford's statement that the current weakness "did not result in misstatements to our consolidated financial statements," suggesting procedural rather than substantive financial reporting problems. The conflicting recommendations from proxy advisors (ISS opposing, Glass Lewis supporting) highlight the subjective nature of governance effectiveness evaluation.
The secondary issue involves executive compensation, with ISS opposing Burford's carried interest allocation model. The company defends this approach by noting it's standard for alternative asset managers (citing Ares, TPG, Carlyle and Apollo) and aligns management with shareholders since it's based on "profitable cash flow without regard to any fair value or accounting movements."
From a governance perspective, this dispute exemplifies the tension between standardized external advisory metrics and management's contextual explanation of oversight responsibilities. While material weaknesses in controls warrant scrutiny, the non-financial impact and detailed contextual explanation provide important mitigating factors for shareholders to consider in their voting decisions.
ISS has recommended that shareholders vote against the re-election of two directors, namely Christopher Halmy (the Vice Chair and putative Chair in 2027) and Robert Gillespie. ISS' recommendation is based on a misunderstanding of facts that have been clearly explained previously to shareholders and also, in the case of Mr Halmy, a factual error about the date on which he joined Burford's board of directors (the "Board of Directors").
Notably, Glass Lewis does not concur with ISS' recommendation and has supported both directors' re-election to the Board of Directors.
We ask shareholders to disregard ISS' recommendation and re-elect Messrs Halmy and Gillespie to the Board of Directors.
ISS' entire analysis is as follows:
The company has had ineffective internal control over financial reporting since FY2021. This issue poses serious risks to shareholders and indicates that the audit committee has failed to provide sufficient oversight over the financial reporting process at the company over the past year. As such, support is not warranted to Audit Committee members Robert Gillespie and Christopher (Chris) Halmy.
What ISS appears to have done is to conflate two entirely different matters: (i) the modifications to Burford's valuation approach (which caused valuations to increase) that were driven by engagement with the SEC as extensively reported to shareholders and affected Burford's consolidated financial statements for the years ended December 31, 2020, 2021 and 2022; and (ii) the current reported material weakness in financial controls relating to a lack of available evidence to demonstrate the precision of management's review of the process to determine certain assumptions used in the measurement of the fair value of capital provision assets, which material weakness did not result in misstatements to our consolidated financial statements. Those matters are unrelated to each other and certainly do not provide any basis—even under ISS' own guidelines—for terminating two valuable and experienced directors. (Moreover, Mr Halmy was not even on the Board of Directors in 2021.) Glass Lewis agrees, having recommended a vote in favor of re-election of both Messrs Halmy and Gillespie to the Board of Directors.
As evident from their bios contained in the 2025 Proxy Statement, both Messrs Halmy and Gillespie are extremely qualified to serve as members of the Board of Directors and on the audit committee of the Board of Directors (the "Audit Committee"), with each having contributed significantly to the success of Burford. Mr. Gillespie helped to oversee Burford's listing on the New York Stock Exchange in 2020, with Burford having been the first publicly-traded legal finance company in the US, and the transition from reporting under the International Financial Reporting Standards to reporting under generally accepted accounting principles in
We also ask shareholders to vote in favor of our executive compensation.
While we are addressing ISS' recommendations, we would also note that ISS has recommended a vote against executive compensation because ISS dislikes the use of carried interest allocations, just as ISS regularly recommends against compensation at other alternatives firms including Ares, TPG, Carlyle and Apollo on the same basis. We think this position is misguided and we believe—as do the world's largest and most successful alternative managers—that carried interest allocations align the interests of management and shareholders, in that management is only paid carried interest allocations when investments produce profitable cash flow without regard to any fair value or accounting movements. We encourage shareholders to vote in favor of our executive compensation, which is consistent with our approach to compensation for many years, has been fully described to shareholders and is commensurate with our cash performance.
Bios of Messrs Halmy and Gillespie
Each of Mr. Gillespie and Mr. Halmy is an independent and qualified member of the Audit Committee. Mr. Halmy is an independent non-executive director, the Vice Chair of the Board of Directors, the Chair of the Audit Committee and a member of the Compensation Committee. He has served as a director on the Board of Directors since May 2022. Mr. Halmy was most recently a Senior Advisor to McKinsey & Company from August 2019 to December 2024, focusing predominantly on auto lending. Prior to McKinsey & Company, Mr. Halmy was the Chief Financial Officer of Ally Financial Inc. (NYSE: ALLY), where he led the multinational initial public offering and was responsible for Ally Financial Inc.'s
Mr. Gillespie is an independent non-executive director and the Chair of the Nominating and Corporate Governance Committee and a member of the Audit Committee. He has served as a director on the Board of Directors since May 2020. Mr. Gillespie had a lengthy career as an investment banker, spending more than 25 years at UBS and its predecessors in a range of senior positions, including Vice Chairman, Chief Executive Officer, EMEA, and Joint Global Head of Investment Banking, while also serving on the Group Managing Board and the Management Committee for many years. Mr. Gillespie started his career as a Chartered Accountant at PricewaterhouseCoopers. Mr. Gillespie is the chair of the board of directors and a member of the audit committee of the
About Burford Capital
Burford Capital is the leading global finance and asset management firm focused on law. Its businesses include litigation finance and risk management, asset recovery and a wide range of legal finance and advisory activities. Burford is publicly traded on the New York Stock Exchange (NYSE: BUR) and the London Stock Exchange (LSE: BUR) and works with companies and law firms around the world from its global network of offices.
For more information, please visit www.burfordcapital.com.
This press release does not constitute an offer to sell or the solicitation of an offer to buy any ordinary shares or other securities of Burford.
This press release does not constitute an offer of any Burford private fund. Burford Capital Investment Management LLC, which acts as the fund manager of all Burford private funds, is registered as an investment adviser with the US Securities and Exchange Commission. The information provided in this press release is for informational purposes only. Past performance is not indicative of future results. The information contained in this press release is not, and should not be construed as, an offer to sell or the solicitation of an offer to buy any securities (including interests or shares in any of Burford private funds). Any such offer or solicitation may be made only by means of a final confidential private placement memorandum and other offering documents.
Forward-looking statements
This press release contains "forward-looking statements" within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Securities Exchange Act of 1934, as amended, that are intended to be covered by the safe harbor provided for under these sections. In some cases, words such as "aim", "anticipate", "believe", "continue", "could", "estimate", "expect", "forecast", "guidance", "intend", "may", "plan", "potential", "predict", "projected", "should" or "will", or the negative of such terms or other comparable terminology, are intended to identify forward-looking statements. Although Burford believes that the assumptions, expectations, projections, intentions and beliefs about future results and events reflected in forward-looking statements have a reasonable basis and are expressed in good faith, forward-looking statements involve known and unknown risks, uncertainties and other factors, which could cause Burford's actual results and events to differ materially from (and be more negative than) future results and events expressed, projected or implied by these forward-looking statements. Factors that might cause future results and events to differ include, among others, those discussed in the "Risk Factors" section of Burford's Annual Report on Form 10-K for the year ended December 31, 2024 filed with the US Securities and Exchange Commission on March 3, 2025. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements contained in the periodic and current reports that Burford files with or furnishes to the US Securities and Exchange Commission. Many of these factors are beyond Burford's ability to control or predict, and new factors emerge from time to time. Furthermore, Burford cannot assess the impact of each such factor on its business or the extent to which any factor or combination of factors may cause actual results and events to be materially different from those contained in any forward-looking statement. Given these uncertainties, readers are cautioned not to place undue reliance on Burford's forward-looking statements.
All subsequent written and oral forward-looking statements attributable to Burford or to persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. The forward-looking statements speak only as of the date of this press release and, except as required by applicable law, Burford undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
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SOURCE Burford Capital Limited
FAQ
Why did ISS recommend against Burford Capital (BUR) directors' re-election in 2025?
What is the difference between Glass Lewis and ISS recommendations for BUR directors in 2025?
What major transitions has Burford Capital (BUR) undergone since 2020?
Why does ISS oppose Burford Capital's (BUR) executive compensation structure?
