Morgan Stanley shareholders on Tuesday voted against a proposal that would have required that the chairman be an independent director who hasn’t previously served as an executive officer of the company.
Shareholders at the company’s annual meeting in Purchase, N.Y., approved all of management’s proposals and voted against all of the measures proposed by shareholders, including the one for an independent chairman, Chief Legal Officer Gary Lynch said.
Morgan Stanley’s board of directors unanimously opposed the idea, saying in the proxy that investors are best served by “maintaining the flexibility to have any individual serve as chairman of the board.” The proposal was submitted by the $1.96 billion Laborers National Pension Fund, Dallas.
Current Chairman John Mack was also CEO until this year, when James Gorman took over.
In response to a shareholder at the meeting who said it appeared Mr. Mack was still running the company, Mr. Mack said he would quit if Mr. Gorman ever told him he was an obstacle.
Shareholders also voted to re-elect board members, and approved 38 million additional shares to be used for equity-based compensation during the next year. Morgan Stanley said in the proxy that the shares are needed to address calls from regulators that a greater proportion of pay be made up of stock.
Morgan Stanley executives have sent letters to shareholders in the past month asking them to vote in favor of the proposal on approving new shares. Two proxy advisory groups have come out in opposition and four institutional shareholders have sent in their votes against it, according to the website ProxyDemocracy.