Telco stockholders vote nay on ‘say-on-pay’

Stockholder bids for greater say on executive compensation and more transparency generally fared ill at Networx contractor parent company annual meetings.

AT&T Inc., Qwest Communications Inc., Sprint Nextel Corp. and Verizon Communications Inc. have held their annual meetings, although final votes have not been decided. Level 3 Communications Inc. held its annual meeting May 19, but no stockholder proposals was on the agenda.

All four of Qwest stockholder proposals were shot down at the company’s May 13 annual stockholder meeting. A bid to require stockholder approval for extraordinary benefits for senior executives’ retirement plans garnered only a 23 percent approval. A vote to let stockholders vote annually to approve executive compensation also lost, with 58 percent voting nay.

A proposal that would have let shareholders of 10 percent of company stock call a special meeting was narrowly rejected, with 52 percent voting against, 47 voting for and 1 percent abstaining. Re-incorporating Qwest in North Dakota was overwhelmingly — 97 percent voting no — rejected.

At Sprint’s May 12 annual meeting, a proposal giving shareholders of 10 percent stock ownership the right to call special meetings won. Sprint said its board will consider the outcome of the vote. The board had opposed the proposal.

However, a bid by Sprint stockholders to require greater reporting on Sprint’s political contributions was defeated.

At Verizon’s May 7 annual meeting shareholders lost four of five bids for change, including the so-called “golden coffin” proposal, which would have required shareholder approval of benefits paid an executive after his or her death. The winning bid was for a proposal to lower from 25 percent to 10 percent, the number of shares a shareholder must own to be allowed to call a special meeting. According to Verizon, its board said it would “consider the outcome of the vote in its ongoing review of the company's corporate governance practices.”

Other defeated proposals would have prohibited granting of stock options; separated the offices of chairman and CEO; and allowed cumulative or weighted voting.

An AT&T stockholder proposal calling for stockholder approval for executive compensation was narrowly defeated by a vote of 53 percent against and 47 percent in favor.

Also defeated at AT&T’s annual meeting April 24 were proposals recommending more reporting of the company’s political contributions; letting shareholders of 10 percent of company stock call a special meeting; allowing cumulative voting for directors; naming a special independent lead director; and excluding return on pension plan assets in determining performance-based compensation.