The California Public Employees’ Retirement System (CalPERS) is seeking shareowner support for its proposal to have unopposed board candidates of Apple Inc. elected by majority vote.
“We believe a majority voting standard is necessary to provide shareowners better protection for the long-term – accountability is our best protection in the face of uncertainty,” Anne Simpson, Senior Portfolio Manager, CalPERS Head of Corporate Governance, said in support of the non-binding proposal on the computer company’s February 23 annual meeting in Cupertino, California.
Apple’s current plurality vote rule gives no voice to shareowners who oppose a candidate, since
directors can be elected by a single “for” vote. CalPERS Proposal #6 urges company adoption of a majority vote threshold where there is only one candidate for a board seat and the resignation of any candidate or incumbent who fails to win an affirmative vote of most shares represented.
Apple is one of 58 U.S. companies that CalPERS has asked to voluntarily adopt a majority vote rule. To date, 28 of those companies have adopted or have committed to adopting a majority vote rule.
“Plurality voting is rapidly being replaced with majority voting in director elections,” Simpson said.
“Approximately 80 percent of the S&P 500 and 60 percent of the Russell 1000 have adopted some form of majority voting – an indication of the current direction of good corporate governance. This governance best practice is also being utilized by other California incorporated companies – Cisco Systems Inc., PG&E Corp., Edison International, and Sempra Energy.”
For a copy of the Apple shareowner letter, a list of the 58 companies, proxy votes and other corporate governance information, visitwww.calpers-governance.org. CalPERS owned 2.6 million Apple shares as of record date December 27, 2010.
CalPERS is the nation’s largest public pension fund with approximately $226 billion in assets. It administers retirement benefits for more than 1.6 million active and retired State, public school and local public employees and their families. For more CalPERS information, visit www.calpers.ca.gov.