News Archive: June 2010

ProxyDemocracy News

June 1, 2010 at 09:21 AM

"Shareholders are fed up about corporate excesses," shareholder activist Laura Berry writes. "But they aren't waiting for Congress to make changes." She praises ProxyDemocracy as an excellent site for researching the issues on corporate ballots.

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The tide has shifted with respect to how much thought mainstream investors are giving to environmental, social, and corporate governance issues. Michael Passoff of the shareholder advocacy group As You Sow says, "Nothing comes close to the support we're getting now."

The methods by which some companies elect their board members wouldn't be amiss in a shady dictatorship. But one important change to corporate bylaws could make such dealings history.

Corporate opposition to votes on executive compensation could be moot as lawmakers in Washington work on legislation that could make the ballot items mandatory at all publicly traded companies’ annual meetings.

Bill McNabb, chief executive officer of Vanguard Group, gets quizzed on the mutual fund company's voting record in an interview that cites ProxyDemocracy data. See his answer to the question: "Is Vanguard being as activist on behalf of its investors as it should be?"

Three stockholder-backed proposals were defeated at Caterpillar Inc.'s annual meeting. The items would have split the job of chairman and chief executive; reviewed whether Caterpillar's products are used in ways that violate human rights: and permitted special shareholder meetings if just 10 percent of shareowners sought one.

Abercrombie & Fitch Co. shareholders signaled their dissatisfaction with teen retailer's pay practices by defeating a long-term incentive plan and narrowly reelecting a member of the board's compensation committee.

Genzyme Corp. headed off a proxy battle set to be waged at its annual shareholder meeting next week. The biotechnology company has struck a deal with activist shareholder Carl C. Icahn that gives him two seats on Genzyme’s board.

Despite nearly two years of outrage, pay czars and congressional hearings, Wall Street hasn’t changed how it pays employees. If something new is going to happen, shareholders will have to exercise their power in say-on-pay votes.

A closed-end mutual fund run by DWS Investments recently ran a slate of board members for reelection. While the incumbents won less than half of the votes cast, they still managed to keep their seats.

In an interview, Connecticut State Treasurer Denise Nappier discusses her activist stance on corporate governance, including a challenge of the management of Massey Energy Co.

Support for social and environmental resolutions has averaged 19 percent in the current proxy season, according to the Sustainable Investments Institute. Propopsals on diversity and equal employment have gotten the most backing, followed by those on corporate political activity.

Shareholders of Wal-Mart Stores Inc. rejected six investor-sponsored proposals, ranging from the disclosure of political contributions to the power to call special meetings.

"Given the Senate’s passage of the Financial Reform Act, we are now much closer to a new reality of major governance changes being imposed on companies" in 2011, says Francis H. Byrd of the Altman Group.

Two compensation committee members at Nabors Industries Ltd. received about 48 percent opposition at the company’s annual meeting, according to the American Federation of State, County and Municipal Employees, which waged a “vote no” campaign.

Trillium Asset Management's resolution asking that Chevron Corp. consider directors with environmental expertise for upcoming vacancies received 27 percent support.

Financial reform seems certain to usher in rules that shareholder advocates have been trying to win for decades as a way to rein in runaway executive pay and make corporate boards more responsive to shareholders

Support for shareholder say-on-pay proposals seeking annual advisory votes has declined slightly from last year. As of May 26, pay proposals were averaging 45 percent of the vote, compared with 47 percent a year earlier. There have been nine majority votes this season.

After years of trying to persuade Fidelity Investments to divest from companies with ties to Sudan, the Unitarian Universalist Association shifted its $178 million retirement plan from Fidelity to TIAA-CREF.