Pension Funds Appeal SEC Ruling On Disney Proxy Issue
By SIOBHAN HUGHES
December 29, 2004 7:59 p.m.
Of DOW JONES NEWSWIRES
WASHINGTON -- A group of pension funds on Wednesday asked the Securities and Exchange Commission to reconsider a staff decision to allow Walt Disney Co. (DIS) to withhold from its proxy a resolution to give shareholders more power to nominate their own board candidates.
The appeal came one day after the SEC staff sided with Disney and allowed the resolution to be omitted from proxy materials that are sent to shareholders ahead of the 2005 annual meeting. Alan Beller, the SEC's director of corporation finance, said in the Tuesday letter only that there was "some basis" for the view that Disney may exclude the proposal.
The American Federation of State, County and Municipal Employees Pension Funds, the California Public Employees' Retirement System, the Illinois State Board of Investment and the New York State Common Retirement Fund had submitted the resolution. In their appeal, the pensions sought to prod the SEC to rule on whether shareholders will be allowed to use company proxy ballots to advance their own resolutions and proposals.
"In the event that the commission declines to review staff's position, we request that the commission direct the staff to explain its position so that shareholders and public companies have clear guidance on the viability of open access shareholder proposals and properly draft any such proposals," the pension group said in a Dec. 29 letter to SEC Chairman William Donaldson.
The SEC has been wrangling with the issue of shareholder access to corporate ballots. It has proposed a rule that would make it easier for shareholders to nominate their own board candidates using company-issued proxy ballots, but has not acted on the rule amid disagreement on the commission.
In the meantime, the SEC staff has been excluding from company proxies any shareholder proposals that don't closely match up with the language of the SEC rule proposal. Earlier this year, it rejected shareholder proxy access plans at Qwest Communications International Inc. (Q) and Verizon Communications Inc. (VZ) on the grounds that the proposals differed too much from the SEC proposal.
On Dec. 8, the SEC staff had initially approved the inclusion of the Disney shareholder resolution, before reversing course on Tuesday and ruling in the company's favor.
SEC officials could not be reached for comment. A Disney representative declined comment about an appeal.
-By Siobhan Hughes, Dow Jones Newswires; 202-862-6654; Siobhan.Hughes@dowjones.com
(Phyllis Plitch contributed to this article.)
By SIOBHAN HUGHES
December 29, 2004 7:59 p.m.
Of DOW JONES NEWSWIRES
WASHINGTON -- A group of pension funds on Wednesday asked the Securities and Exchange Commission to reconsider a staff decision to allow Walt Disney Co. (DIS) to withhold from its proxy a resolution to give shareholders more power to nominate their own board candidates.
The appeal came one day after the SEC staff sided with Disney and allowed the resolution to be omitted from proxy materials that are sent to shareholders ahead of the 2005 annual meeting. Alan Beller, the SEC's director of corporation finance, said in the Tuesday letter only that there was "some basis" for the view that Disney may exclude the proposal.
The American Federation of State, County and Municipal Employees Pension Funds, the California Public Employees' Retirement System, the Illinois State Board of Investment and the New York State Common Retirement Fund had submitted the resolution. In their appeal, the pensions sought to prod the SEC to rule on whether shareholders will be allowed to use company proxy ballots to advance their own resolutions and proposals.
"In the event that the commission declines to review staff's position, we request that the commission direct the staff to explain its position so that shareholders and public companies have clear guidance on the viability of open access shareholder proposals and properly draft any such proposals," the pension group said in a Dec. 29 letter to SEC Chairman William Donaldson.
The SEC has been wrangling with the issue of shareholder access to corporate ballots. It has proposed a rule that would make it easier for shareholders to nominate their own board candidates using company-issued proxy ballots, but has not acted on the rule amid disagreement on the commission.
In the meantime, the SEC staff has been excluding from company proxies any shareholder proposals that don't closely match up with the language of the SEC rule proposal. Earlier this year, it rejected shareholder proxy access plans at Qwest Communications International Inc. (Q) and Verizon Communications Inc. (VZ) on the grounds that the proposals differed too much from the SEC proposal.
On Dec. 8, the SEC staff had initially approved the inclusion of the Disney shareholder resolution, before reversing course on Tuesday and ruling in the company's favor.
SEC officials could not be reached for comment. A Disney representative declined comment about an appeal.
-By Siobhan Hughes, Dow Jones Newswires; 202-862-6654; Siobhan.Hughes@dowjones.com
(Phyllis Plitch contributed to this article.)