An SEC staff decision today ruled that Halliburton Co., Houston, may exclude a shareholder proposal filed by several pension funds that would permit shareholders to nominate candidates to Halliburton's board of directors.
Jointly filing the proposal were the $33 billion New York City Employees' Retirement System; the $26.7 billion New York City Teachers' Retirement System; the $19.9 billion Connecticut Retirement Plans and Trust Funds, Hartford; and the $600 million American Federation of State, County and Municipal Employees pension fund, Washington.
"(W)e will not recommend enforcement action to the Commission if Halliburton omits the proposal from its proxy materials…" Alan L. Beller, director, SEC's Division of Corporation Finance, wrote in the decision.
Gerald W. McEntee, chairman of the AFSCME fund and president of the union, said in a statement, "It is disingenuous for the SEC to first establish an interim process to allow shareholders to offer advisory proxy access proposals and then take away that right because they have taken too long to make their own decision.
"After almost two years of deliberation, the SEC must now offer guidance and a final rule that establishes a process for how shareholders can nominate directors," Mr. McEntee's statement said. "The reason why shareholders need access can be found on the financial pages of newspapers across the country. Corporate financial restatements are up 28 percent, the CEOs at WorldCom, HealthSouth and Enron are on trial, and new scandals continue to make headlines."
Mr. McEntee's statement was critical of Halliburton's business practices and operations. "We hope that the (Bush) administration did not use political influence to protect its special relationship with the company," his statement added. "We intend to pursue proxy access at individual companies where boards have failed shareholders until a broader proxy access rule is established."
"The relief was granted that we requested," said Wendy Hall, Halliburton director of communications. "Apparently, the (SEC) intent is to have the rule making process run its course rather than allow proposals on an ad hoc basis."