Aflacs say-on-pay decision might spread to other firms
WASHINGTON U.S. companies might give shareholders a vote on executive compensation following Aflac Inc.s decision to become the first U.S. company to allow a say-on-pay vote, according to an Institutional Shareholder Services statement released Feb. 23.
"Chances are, anything (other firms) adopt now is going to be called 'the Aflac model,' kind of like how Intel and Pfizer reaped the benefits of being the early adopters on majority-voting bylaws and director-resignation requirements," Patrick McGurn, ISS vice president and special counsel, said in the statement.
So far this year, 52 shareholder proposals calling for an advisory vote on executive compensation have been filed.
Judge says Caremark must give merger details to shareholders
WILMINGTON, Del. Caremark Rx Inc. can proceed with the shareholder vote on its proposed merger with CVS Corp. 20 days after disclosures are provided to Caremark shareholders, Judge William B. Chandler III ruled Feb. 23 in Delaware Chancery Court.
The judge ruled that the companies must disclose their appraisal rights, in connection with a $6 cash special cash dividend component of CVS offer, to seek an independent assessment of a fair value for their shares and also disclose the structure of fees to UBS and JPMorgan for their opinions on the advisability of the Caremark/CVS merger. The fees could total $34 million under completion of a merger, the ruling noted.
The $1.4 billion Louisiana Municipal Police Employees Retirement System, Baton Rouge, represented by the law firm of Bernstein Litowitz Berger & Grossmann, led a group of institutional investors seeking the delay to give shareholders more time to evaluate the proposal. The original merger vote was scheduled for Feb. 20. CVS also postponed its merger vote, which was originally scheduled for Feb 23.
Shareholders would suffer irreparable harm only were they to be forced to vote without knowledge of the material facts relating to the structure of bankers fees and, most importantly, their entitlement to appraisal rights under the transaction as it is presently constructed, Mr. Chandler wrote.
Caremark officials didnt respond for comment.
CalPERS, CalSTRS push H-P shareholder proposal
SACRAMENTO, Calif. CalPERS and CalSTRS on Feb. 20 asked Hewlett-Packard Co. shareholders to support a bylaws amendment that would permit large shareholders to nominate directors to the company board.
Officials of the $236.6 billion California Public Employees Retirement System and the $158 billion California State Teachers Retirement System cited spying and stock option scandals at H-P as reasons to give shareholders a greater say. The funds sent a letter to up to 7,500 HP shareholders, urging them to support the measure.
Sadly, today share owners have no way to hold dysfunctional companies with entrenched boards that harm a companys ability to grow, create jobs and generate share owner value accountable, said Rob Feckner, CalPERS board president.
The proposal, which will be considered at H-Ps March 14 annual meeting, would allow shareholders that have beneficially owned at least 3% of HP common stock for a minimum of two years to nominate up to two board candidates.
The proposal was submitted by the $850 million American Federation of State, County and Municipal Employees staff pension plan, Washington; the $144.3 billion New York Common Retirement Fund, Albany; the $22.9 billion State of Connecticut Retirement Plans and Trust Funds, New Haven; and the $70 billion North Carolina Retirement Systems, Raleigh.
CalPERS owns 16.5 million HP shares, and CalSTRS, 12.6 million.