For Immediate Release
Thursday, September 07, 2006
McEntee Calls 2nd Circuit Ruling "Holy Grail" of Corporate Governance Reform
Federal Court Decision Gives Shareholders Meaningful Voice In Board Elections
WASHINGTON —Gerald W. McEntee, chairman of the AFSCME Employees Pension Plan, issued the following statement in response to Tuesday's ruling by the 2nd U.S. Circuit Court in the American International Group case, making it easier for shareholder-nominated candidates to run for director positions on corporate boards.
"The decision of the U.S. Court of Appeals for the Second Circuit is hugely significant for shareholders. We have always argued that you can’t have a true election when only one party is empowered to put a name on the ballot. This ruling can give shareholders a meaningful voice in board elections by opening up the director nominating process.
"Proxy access is considered the 'holy grail' of corporate governance reform because it offers shareholders the opportunity to change the composition of boards. This ruling will make directors think twice before they put their own interests above the interests of their shareholders.
"The ruling is timely because it will allow shareholders to establish proxy access procedures on a company-by-company basis for 2007 annual meetings."
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