Nationwide is under mounting pressure to address what critics describe as “emerging governance issues” across the building society sector, as concerns grow that executives are bundling voting options and failing to allocate board seats for members.
MP Raises Concerns in Formal Letter
The Stockport Labour MP Navendu Mishra has sent a formal letter to Nationwide’s chair, Kevin Parry, outlining unease over how executives, including those at Nationwide, have been engaging with members who ultimately own their building societies. A similar letter was sent to Chancellor Rachel Reeves in recent weeks.
Although the Labour government is pushing ahead with reforms to double the size of the mutual sector, critics worry that some building societies, including Nationwide, are allowing their democratic values to slip. Nationwide recently confirmed it holds £382bn worth of assets after its £2.9bn takeover of Virgin Money.
“Their growth is exponential, which is fantastic,” Mishra said. “But obviously, we need to make sure that if Nationwide are always going on about how they are mutually owned … then we need to see that democracy.”
Member Representation at Board Level
The letter was sent weeks before Nationwide’s annual general meeting (AGM), which will feature its first member-nominated candidate for board election this century. Mishra noted that despite being member-owned, direct representation remains uncommon across the sector.
“There is a wider question as to whether building societies should allocate seats on boards to member-nominated directors in order to strengthen direct member representation,” the MP’s letter stated. “Where members are the owners, it is reasonable to ask why direct member voice in the boardroom remains the exception rather than the norm.”
‘Quick Vote’ Options Under Fire
Mishra, a Nationwide member himself, also pressed Parry on the use of “quick vote” options, which critics say nudge members to back all board recommendations with one click at AGMs. He admitted to having used the quick vote function in the past, calling it “convenient,” but raised concerns it could “reduce scrutiny and advantage incumbents.”
“That’s not allowed for trade unions, which are member-led organisations. So I don’t see why that should be allowed for building societies,” he said.
James Sherwin-Smith, a Nationwide member standing for board election, has formally asked the society to suspend its quick vote at the upcoming AGM. Nationwide chief executive Debbie Crosbie said during a media call on Thursday that the board “haven’t made a final decision on that yet.”
Online-Only AGMs and Executive Pay
The letter also criticised the growing adoption of online-only AGMs, which may exclude members who struggle with internet access and raise concerns about question-filtering, as well as the refusal to hold binding member votes on executive pay.
This comes a year after Nationwide faced backlash for not holding a binding vote on a 43% pay rise for Crosbie’s maximum package, allowing her to earn up to £7m. In contrast, listed banks such as Barclays, NatWest, and Lloyds hold binding votes on pay.
Nationwide’s Response
In a statement, a Nationwide spokesperson said that while pay votes are non-binding, 95% of votes cast supported the remuneration policy. They added that online-only AGMs have reversed declining attendance and are the fairest way to engage millions of members.
They defended the long-time use of the quick vote tool, noting that most member feedback described it as “clear and easy to use. All building societies and listed companies use similar quick vote or proxy voting systems.”
“The chair will make these and other points in writing back to the MP in the next few days,” the spokesperson concluded.
