US - The California Public Employees' Retirement System (CalPERS) is to oppose the re-election of seven board members of electronics company Sanmina-SCI Corporation because of unresolved poor stock performance and governance practices.
He said: "Its stock price continues to decline and trail its industry peers. The board's failed acquisition strategy has destroyed a substantial amount of shareowner value."
Seven members of the board are up for re-election at the company's annual meeting on 28 January 2008 but CalPERS said it would withhold votes.
Sanmina, of which CalPERS owns 2.1 million shares, had a stock price decline of 65% for the five-year period ending 18 January 18, 2008. It underperformed its industry peer group by 60% during that time.
The announcement came as New York City comptroller William Thompson, Jr., said the New York City Employees' Retirement System (NYCERS) had resubmitted shareholder proposals with Blockbuster, Inc. and The Home Depot that would give shareholders an advisory vote on executive pay.
The proposals call on the companies' boards of directors to adopt a policy that would give shareholders a non-binding advisory vote at the companies' annual meetings, on the compensation of named executive officers.
Thomson said: "News reports of inflated executive salaries and compensation packages have been shocking investors.
"NYCERS has taken action by calling for a say on executive pay."
NYCERS, which holds 157,000 shares in Blockbuster, Inc and 1,990,855 shares in The Home Depot, filed similar proposals with The Home Depot and Blockbuster last year.
The proposal received 57% of the votes cast at Blockbuster's 2007 annual meeting, marking the second time this proposal had received a majority vote in the US.
Shortly after the 2007 annual meeting, Comptroller Thompson wrote to Blockbuster asking how the company intended to respond to the majority vote.
The company responded, after the fund re-filed the resolution for 2008, that it was seeking to better align pay with performance, and requested that the proposal be withdrawn. However, the fund refused, advocating the view that the policy should be embraced as a fundamental principle of good corporate governance.
The proposal received 43% of the votes cast at The Home Depot's 2007 annual meeting.
Last year, NYCERS also filed the proposal with Par Pharmaceuticals, which received a 56.8% majority vote at the company's 2007 annual meeting. As a result, Par Pharmaceuticals agreed to implement the proposal beginning in 2009.
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