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Administration April 1, 2005
AFSCME Fund Raises Shareholder Rights Proposal with Halliburton
January 4, 2005 (PLANSPONSOR.com) - A large pension
fund is continuing its efforts to win new rights for
shareholders to nominate board members with a request to
federal regulators to block efforts by Halliburton Co. to
keep shareholders from voting on a directors nomination
plan.
Reported by Fred Schneyer
The American Federation of State, County and Municipal Employees Pension Fund (AFSCME), urged the US Securities and Exchange Commission’s (SEC) corporation finance division staff to reject a Halliburton request to exclude the proposal from consideration at its 2005 annual meeting, Dow Jones reported.
AFSCME joined with the Connecticut Retirement Plans and Trust Funds in October 2004 in drafting a proposal giving Halliburton shareholders the right to nominate up to two directors to the firm’s 11-member board. In mid-December, Halliburton asked the SEC staff for assurances that it might exclude the proposal from consideration at this year’s annual meeting.
AFSCME’s shareholder rights efforts at Halliburton follow the pension system’s similar moves focusing on the Walt Disney Company. SEC staff announced in early December that it would not allow Disney to block a shareholder director nomination resolution but later reversed itself, decreeing the proposal may be excluded from a vote by Disney shareholders (See Funds Appeal SEC Staff Disney Proxy Access Decision ).
The SEC proposed a plan in 2003 that would make it easier for shareholders to nominate their own candidates to corporate boards. The agency has yet to finalize the proposal and it has met with intense opposition from business groups. In the meantime, the SEC staff has repeatedly rejected proposals to give shareholders a greater voice in nominating corporate directors, doing so in the case of Qwest Communications International Inc. and Verizon Communications.
Drafting problems the SEC staff identified with the Qwest, Verizon and Disney proxy-access proposals “are not present” in the resolution drafted on behalf of Halliburton shareholders, AFSCME wrote. The Halliburton proposal specifies that an individual or group of shareholders would be eligible to nominate directors if they have owned more than 5% of outstanding shares for at least two years, exactly the language used by the SEC in its own proposal, AFSCME noted, according to Dow Jones.
More information about the SEC’s delilberations is at http://www.sec.gov/spotlight/dir-nominations.htm .