CalPERS to Withhold Support for Eisner Reelection

February 10, 2005 ( - The California Public Employees' Retirement System (CalPERS) will withhold its support for the reelection of controversial Disney CEO Michael Eisner.

CalPERS holds 9.44 million shares of Walt Disney Co., and said that it has lost confidence in Eisner’s ability to create shareholder value. It will also vote against a proposed stock incentive plan at the Disney annual meeting on Thursday, citing a lack of performance-based incentives, according to Dow Jones.

CalPERS also expressed the sentiment that it would not wish him to remain on the company’s board after a new CEO is hired, Dow Jones said.

Last year, CalPERS joined other shareholders and ex-directors Roy Disney and Stanley Gold in a battle that resulted in 45% of the shares withholding support for Eisner, a move that stripped him of his chairmanship. He has since announced his plans to step down in 2006 as CEO.

CalPERS is well known for throwing its weight around as a shareholder, withholding votes at other companies including Hewlett-Packard and Safeway (See Running the Fund: Clear Conscience? ).

Some controversy has erupted as of late with recently ousted CalPERS President Sean Harrigan claiming that his removal was due to his stance on corporate governance and the actions the pension giant took when he was there (See CalPERS’ Harrigan: I’m Being Ousted ).