CUPERTINO - Apple shareholders voted on two shareholder proposals Wednesday during the company’s annual shareholder meeting. Preliminary voting announced during the event indicated that shareholders had rejected a proposal requiring the company’s management to disclose its internal succession plan, while they accepted a proposal to change the way board members are elected.
Apple’s management officially resisted both proposals, and the fact that one of them was passed marks a rare defeat — though a minor one — for the company. Officially listed as proposal #6, the proposal voted in amended Apple’s corporate bylaws to require a majority vote for members of the board of directors.
The existing system, which was incidentally used today to reappoint the entire current board of directors, requires a plurality of at least 25% of shareholders voting for a candidate. Shareholders can not actually vote against a specific candidate, they can either accept the entire board or abstain.
The proposal was put forth by the California Public Employees’ Retirement System, and now that it has been adopted, board members will be required to receive a majority of votes represented in the quorum in attendance (or represented by proxy ballots) for the company’s shareholder meeting.
The shareholder rejected — proposal #5 — would have required that Apple make transparent its succession plans for the company’s CEO position. Put forth by one of the pension funds of the Laborers’ International Union of North America (LIUNA), the proposal’s stated goal was to increase the transparency of Apple’s corporate governance.
Apple had asked shareholders to reject the proposal on the grounds that revealing its succession plans could offer competitors an advantage and/or cause discord in Apple’s existing executive ranks. Whether or not that would have been the case, AAPL owners rejected the proposal.
In a statement released after the shareholder meeting, LIUNA said that it would continue to fight for this shareholder proposal.
“The men and women who invest in these plans do back-breaking work all day building this country – they deserve to have their retirement savings invested in stable, responsible companies,” LIUNA General President Terry O’Sullivan said. “We’ll continue to demand Apple’s board behaves responsibly and does right by its shareholders. It’s good for the company, investors and the economy for Apple to demonstrate that it’s prepared.”
*In the interest of full disclosure, the author holds a small share in AAPL stock that was not an influence in the creation of this article.