A group of pension funds is continuing to apply pressure on the Securities and Exchange Commission to enact rules that would make it easier for outside shareholders to nominate directors not necessarily picked by management.
On Wednesday, the Connecticut Retirement Plans and Trusts and the American Federation of State, County, and Municipal Employees Pension Fund (AFSCME) filed a proposal that would enable investors that own at least 5 percent of the shares to nominate one or two directors to the board of directors of Halliburton Co, according to Bloomberg News.
Those two institutional investors were among a number of groups that recently filed a similar proposal at Walt Disney. The Disney and Halliburton proposals also resemble the one that four pension funds, including AFSCME, prepared for Marsh & McLennan Cos. earlier in the year.
The Marsh proposal, however, was withdrawn before its annual meeting after the financial services company nominated former federal prosecutor Zachary Carter to its board. The pension groups issued a press release approving of the move.
Richard Ferlauto, director of pension and benefit policy at AFSCME, has repeatedly said his group plans to file similar proposals at many more companies by the time the proxy season rolls around next spring. “We are moving ahead, and the SEC is going to have to address this issue one way or another,” he told Bloomberg. “The cleanest way to do that is to pass their proposal.”
The SEC proposed a number of rules to govern the director nomination process about a year ago. The SEC’s proposal would apply to certain shareholders who owned more than 5 percent of a company’s shares for two years. But the controversial recommendations have still not been turned into official regulations.
As a result, Ferlauto and other pension officials are proposing similar measures at high-profile companies as a way of pushing the SEC into advancing the issue.
Halliburton spokesperson Wendy Hall, a spokeswoman declined to comment on the proposal, according to Bloomberg. “At this point, the company has not had an opportunity to read it, or discuss any proposed handling,” Hall reportedly said.