Goldman Changes Board Structure to Save Chairman Job

March 29, 2012 ( - Goldman Sachs Group Inc. agreed to change its board structure to persuade a union pension fund to drop a shareholder proposal that would cost its CEO Lloyd C. Blankfein his chairman position. 
The deal between Goldman Sachs and American Federal of State, County and Municipal Employees  (AFSCME) means Goldman will appoint a “lead” director; however, shareholders will not have the opportunity to vote at the firm’s annual meeting in May on a proposal to replace Blankfein with an independent chairman, reports The Wall Street Journal.

AFSCME claimed stripping Blankfein of his chairman powers would help Goldman repair its reputation and reduce the potential for conflicts of interest.

AFSCME submitted shareholder proposals to split the chairman and CEO at J.P. Morgan Chase & Co., American Express Co., North Trust Corp. and six other companies. None of these firms held talks with AFSCME on the proposals, the union told The Wall Street Journal.

Last September, the AFSCME proposal submitted to Goldman brought on months of discussions and contingency planning among directors and executives on the firm’s management committee.