US - The pension fund-backed proposal that would give large investors in Hewlett Packard more say over who sat on the board was voted down by shareholders.
Proposal 3 was submitted by a number of the nation’s largest pension funds - and received significant backing from CalPERS – and would have given investors who held at least 3% of HP's stock continuously for a minimum of two years the ability to nominate up to two candidates.
But it only garnered 39% of shareholder votes at HP’s annual shareholder meeting yesterday, while 52% voted against.
Despite the result, CalPERS CIO Russell Read claimed it would still have a material impact well beyond HP.
“It 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,” said Read.
“Two out of every five shareowners took a stand in favour of democracy.”
The result will have come as welcome news to the HP board, who had vehemently opposed the proposal and claimed it would have led to “repeated, costly, distracting and divisive" proxy contests.
Two proposals were however passed at the annual meeting - one making hostile takeovers more difficult, and another capping executive remuneration to a more rigorous evaluation of company performance.
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