Activism
HP holds off shareholder activists
At Hewlett-Packard’s (HP’s) annual meeting last month a
shareholder resolution, submitted and supported by several large US public and
trade union pension funds, to give shareholders the right to nominate directors
to the board, received 39% support.
The resolution was a binding proposal requiring a change
in the company’s bylaws and needed 66% of votes to be cast in favour to pass.
However, the Council of Institutional Investors,
said the level of votes cast in favour was “a remarkable showing for a
controversial shareowner proposal making its debut.”
Russell Read, chief investment officer of
CalPERS, which backed the proposal, said: “This landmark vote will have a
material impact well beyond HP, and will likely establish a new core principle
in American business – that shareowners need the basic right to nominate
directors particularly in extreme circumstances such as those we sadly
experienced at HP. Two out of every five shareowners took a stand in
favour of democracy. We urge HP to not ignore the guidance of those
thousands who voted and who own over $32bn worth of HP stock.”
The IT company had been targeted following revelations
that the company had authorised board members to be spied upon after boardroom
leaks. It was admitted that methods used included impersonating others to obtain
personal telephone records.
HP’s former chairman, Patricia Dunn, who was forced to
resign over the scandal, recently had criminal charges against her dropped by a
judge in California.
Links
Hewlett-Packard
Council of Institutional Investors
CalPERS
April, 2007 |
