Walt Disney Co. shareholders face voting on a non-binding proxy proposal co-sponsored by CalSTRS, Connecticut Retirement Plans & Trust Funds and Legal & General Investment Management, calling for shareholder access to corporate proxy material to nominate directors.
The C$201.5 billion (US$181.9 billion) Canada Pension Plan Investment Board, Toronto; the $176.8 billion Florida State Board of Administration, Tallahassee; and the $20.4 billion General Board of Pension and Health Benefits of the United Methodist Church, Glenview, Ill., are voting in favor of the proposal, according to their proxy-voting disclosures.
Institutional Shareholder Services and Glass Lewis & Co., proxy-voting advisory firms, recommend their clients also vote in favor of the proposal, according to their reports on Disney.
Under the proposal, a shareholder or group of shareholders holding at least 3% of Disney stock for at least three years would be allowed to nominate up to 20% of the directors for election to the company's board.
Vanguard Group, State Street Global Advisors, BlackRock and MFS Investment Management as well as the Laurene Powell Jobs Trust might each meet the threshold of holding enough shares, depending on the time frame, to qualify to nominate directors under the proposal, according to the ISS report. The Jobs trust is Disney's largest shareholder with 7.5% of the company's shares, according to the proxy statement. It was formed from shares owned by Steve Jobs, the late CEO of Apple Inc.
Vanguard, BlackRock and MFS declined to disclose their proxy votes, according to their respective media contacts, David Hoffman, Lauren Post and Dan Flaherty. SSgA media contacts didn't respond to requests for comment.
The $176.2 California State Teachers' Retirement System, West Sacramento, and the Hartford-based $27.1 billion Connecticut pension system contend the proposal would enhance board accountability, according to the proposal.
The proposal provides safeguards to ensure it would not disrupt the board as well as providing the board latitude for determining which nominees appear on the ballot if numerous shareholders nominate board candidates, the ISS report states.
Disney calls on shareholders to vote against the proposal.
“The company's current governance structure protects shareholder rights, ensures board accountability and meets current best practice standards. Proxy access is unnecessary at Disney. … The proponents' suggestion that accountability at Disney is deficient is unfounded and incorrect,” according to Disney's proxy statement.
The FSBA, United Methodist fund and Glass Lewis oppose the pay packages for Robert A. Iger, chairman and CEO, and other top executives.
The United Methodist fund also is voting against the election of Orin C. Smith as director because of his role as director at Washington Mutual, “where poor risk management contributed to the company's failure” and because shareholders did not receive “the full value of their shares when the company was acquired” by J.P. Morgan Chase, M. Colette Nies, managing director-communications, said in an e-mail. Glass Lewis also opposes the election of Mr. Smith for similar reasons.
CPPIB and ISS support the pay packages and all the directors. FSBA is also voting in favor of all the directors, John Kuczwanski, communications manager, said in an e-mail.
The company's annual meeting is March 18.
