Penrice Soda chairman David Trebeck launched an angry attack on dissident shareholder London City Equities (LCE) after he survived Australia's first two strikes board spill meeting.
Mr Trebeck said LCE and its chief executive, Peter Murray, had "cost Penrice a great deal" and suggested the investment firm consider selling its 3.2 per cent stake and "moving on" if it could not be "constructive and forward looking".
"In the aftermath of this failed EGM (extraordinary general meeting) process, I believe LCE and Mr Murray have some serious soul-searching to do," Mr Trebeck said in a prepared speech after the vote.
Mr Trebeck and Penrice deputy chairman Andrew Fletcher were re-elected with 77.8 per cent and 78.4 per cent of shares in their favour respectively.
Three challengers nominated by LCE each received about 25 per cent support.
LCE had held more than six per cent of Penrice at one stage and, as the chemicals maker reported a $26 million loss in 2010/11 and a $63.6 million loss in 2011/12 and suffered a dive in share price to less than six cents, from $1.56 in 2008, LCE had agitated for board renewal.
Penrice became the first company in Australia to face a board spill meeting as a result of the "two strikes" rule legislated in 2011, requiring a board to face re-election if its remuneration report was rejected by more than 25 per cent of shares voted for two years running.
The two strikes were widely seen as a protest over Penrice's disastrous performance rather than executive pay and Mr Trebeck repeated criticism of the new rule at the EGM in Adelaide.
"Ideally, the two strikes policy should be terminated," he said.
"Shareholders who are sufficiently disgruntled with the performance of the board can always muster the numbers to requisition an EGM."
If two strikes is kept, the threshold should be lifted to 50 per cent of votes cast, or 50 per cent of all shares, he said.
Mr Trebeck said directors were capable of responding to shareholder sentiment "without needing a legislative sledgehammer to do it for them".
He also said the straitened economic times meant there was "much less exuberance now" in executive salaries.
However Australian Shareholders' Association policy and engagement coordinator Stephen Mayne said Mr Trebeck's criticism of two strikes was "ridiculous".
"He faced a clear majority of shareholders who wanted to spill the board - that put a rocket under him and he belatedly engaged with his shareholders and unveiled a new strategic direction," Mr Mayne said.
Penrice announced in January, after the second strike was incurred, that it would end local production of soda ash - an ingredient in glass bottles and detergent - and cut up to 60 jobs in a bid to reduce costs.
Penrice shares were unchanged at 11 cents on Friday.