RI Governance & Engagement, May 12: CalPERS’ annual director election proposal gets 69% support

A shareholder proposal by CalPERS calling for Hospitality Properties Trust to hold annual board elections received the support of 68.6% of votes at the US real estate investment trust’s annual meeting on May 11 – less than the required 75%. CalPERS’ proposal had the backing of proxy firms ISS and Glass Lewis.

Hammerson, the UK property company, has lost a shareholder vote that would have authorised it to hold general meetings (ex AGMs) at 14 days notice. Just over 28% of shareholders voted against the special resolution, which required a 75% majority to pass. Shareholders in the UK have stepped up to vote heavily against a number of similar resolutions during this proxy season.

A lawsuit brought by the $6.3bn Wyoming Retirement System and the Police and Fire Retirement System of the City of Detroit against the three major US credit rating agencies has been dismissed. The plaintiffs had sought to hold the agencies liable for their role in the financial crisis as “underwriters” for banks’ structured products. Link

The new Code for External Governance from the European Fund and Asset Management Association (EFAMA) has raised concerns for PIRC. The shareholder advisory firm says it is “really a watered down version of the Stewardship Code rather than a new beginning”.

A proposal from the New York City Comptroller calling for Bank of America to conduct an independent review of its mortgage servicing operations (foreclosures) by September 30 gained 2.2bn votes at the bank’s annual shareholder meeting yesterday (May 11). There were 3.4bn votes against the motion. Results

The Organisation for Economic Cooperation and Development has published a new Corporate Governance Working Paper. Enhancing the Role of the Boards of Directors of State-owned Enterprises summarises the main findings of an interview exercise conducted with the heads of enterprises owned by OECD member states.A proposal raised from the floor at 3M’s annual meeting on May 10 by Walden Asset Management on the company’s role on the board of the US Chamber of Commerce was defeated. There were 471.9m votes against compared to just over 5,000 in favour. A resolution on political contributions from Walden and Trillium Asset Management on political contributions was also defeated but received almost one-third of the vote. Voting results

The Stanford Graduate School of Business has released a study of the impact of proxy advisory firms’ recommendations on shareholder value. The research, led by David Larcker, director of its Corporate Governance Research Program, seeks to answer the question – are shareholders really better off if they follow their recommendations? Link

There’s been a development in the case brought by the New York State and Ohio retirement funds against BP following the Gulf of Mexico oil spill. The company has asked a judge to dismiss the claims that management downplayed safety risks before and after the spill, according a Bloomberg report. And the oil major is also seeking to restrict investor fraud claims to holders of its American depositary receipts (ADRs).

A shareholder proposal by the AFSCME Employees Pension Plan calling for Alcoa Inc. directors to stand for election annually was approved in an a non-binding vote at the industrial giant’s annual shareholder meeting in Pittsburgh on May 6. Link to vote results

Leading shareholders in the UK’s Prudential are to vote against the insurance company’s chairman Harvey McGrath at its annual meeting on May 19, according to an unsourced report in the Daily Mail. Investors are reportedly upset at the Pru’s failed acquisition of AIG’s Asian business AIA.

The World Bank’s IFC and its Global Corporate Governance Forum have launched a toolkit – Resolving Corporate Governance Disputes – aimed at strengthening board directors’ abilities to resolve corporate governance disputes. It provides mechanisms that are “faster, less costly, and more effective than litigation” for companies, regulators, policymakers, mediators and institutes of directors.