In contrast to its prior stance, the research firm is now advising stockholders to vote against an employee-backed proposal, which asks IBM to grant all employees the same medical and pension benefit choices as employees who are within five years of retirement, due to be voted on next week.
Charging that the new plan discriminates on participants based on age, the proposal advocates that IBM provide wither a lump sum equivalent to that of the previous plan, or equal monthly annuities.
ISS reasons that since shareholders first defeated the proposal brought by employees in April last year, negative sentiment and morale are not expected to have any ill effects on the company or its shareholders ( more on the April 2000 vote). The research firm holds that the proposal does not merit shareholder support at this time and recommends a vote against it.
Tension has mounted in recent weeks as IBM repeatedly urged shareholders to vote against the proposal stating that the prior compensation and benefits package was out of line with competitors’ packages ( more on IBM?s position) .
– Camilla Kleineditors@plansponsor.com
Read about the build up to last year’s pension vote .