A bid by Qwest retirees to mandate shareholder approval of severance packages for the company’s top executives, failed to garner the 51% of shares needed to pass the measure. Only 27% of shares were voted in favor of the measure, despite a letter-writing campaign by retirees to gain support for the move.
A second proposal, one that would omit growth in the company’s pension fund assets from being factored into executive bonus calculations, also lost its vote, securing only 39% of the shares cast (see Shareholders Hit Verizon, Raytheon Exec Comp Rules ).
Qwest had recommended rejection of both proposals, arguing that the severance proposal would limit flexibility in arranging competitive pay packages for executives.
The cash-strapped company, arguing that pension credits are not a major factor in determining executive pay, denied that the credits have been used to inflate income.
Though recommending that the severance proposal be rejected, Institutional Shareholder Services (ISS), a provider of proxy voting advice to institutional investors, supported the pension proposal.
Board members and executives own 19% of Qwest’s stock.