No change for La-Z-Boy's
04 August 2010 Sacramento
Image: Shutterstock
The California Public Employees' Retirement System (CalPERS) will ask shareowners at La-Z-Boy Inc.'s August 18 meeting to vote for the Pension Fund's proposal for the annual election of all company directors.
Proposal 4, a binding resolution, requires a two-thirds vote of shares outstanding to pass at the Monroe, Michigan household furniture company's annual shareowners' meeting. A similar CalPERS proposal in 2008 received 57 percent support, short of the threshold. The company took no action.
Currently, La-Z-Boy directors serve in "classes" with staggered terms on the company's board.
"It's outrageous that more than half of voting shareholders two years ago told La-Z-Boy they want this change, and they have done nothing," said Anne Simpson, Senior Portfolio Manager, CalPERS Global Equity. "This company needs to do what so many others have done - adopt the common practice of annual elections."
Simpson, who heads the CalPERS corporate governance program, said companies that have staggered, classified boards are on the decline - comprising 48 percent of the Russell 1000 index in 2009, down from 60 percent in 2004.
CalPERS placed La-Z-Boy on its annual Focus List in 2008 due to a poor governance structure and stock performance. The company underperformed the Russell 3000 Index by 40.1 percent in the five years ending June 30, 2010.
Proposal 4, a binding resolution, requires a two-thirds vote of shares outstanding to pass at the Monroe, Michigan household furniture company's annual shareowners' meeting. A similar CalPERS proposal in 2008 received 57 percent support, short of the threshold. The company took no action.
Currently, La-Z-Boy directors serve in "classes" with staggered terms on the company's board.
"It's outrageous that more than half of voting shareholders two years ago told La-Z-Boy they want this change, and they have done nothing," said Anne Simpson, Senior Portfolio Manager, CalPERS Global Equity. "This company needs to do what so many others have done - adopt the common practice of annual elections."
Simpson, who heads the CalPERS corporate governance program, said companies that have staggered, classified boards are on the decline - comprising 48 percent of the Russell 1000 index in 2009, down from 60 percent in 2004.
CalPERS placed La-Z-Boy on its annual Focus List in 2008 due to a poor governance structure and stock performance. The company underperformed the Russell 3000 Index by 40.1 percent in the five years ending June 30, 2010.
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