By Greg Bensinger
EBay Inc. shareholders approved a measure Friday that will give
them more power to nominate directors of the e-commerce
company.
The proposal, which passed with 59% of shares voted at eBay's
annual shareholder meeting, will allow certain investors to
nominate board members, who are typically nominated by the company
itself. Investors holding at least 3% of eBay's shares for three
years will be able to nominate as many as one-quarter of the
company's directors.
Similar measures have been approved in recent years at companies
including Hewlett-Packard Co. and Verizon Communications Inc. This
year, more than a dozen big U.S. companies, including General
Electric Co. and Bank of America Corp., have agreed to support
letting shareholders nominate their own directors.
EBay had opposed the proposal, which was put forth by New York
City's comptroller, an investor in the company through several
funds.
"EBay values our stakeholders' opinion and intends to engage
with stockholders to develop and implement an appropriate
eBay-specific version of proxy access," a spokeswoman said.
"Today's eBay vote is yet another sign of the huge momentum
behind the push for shareowners to have a meaningful voice in the
boardroom," New York City Comptroller Scott M. Stringer said in a
statement.
Proponents of so-called proxy access say it makes corporations
more accountable to shareholders who can potentially shake up a
board if dissatisfied with a company's strategic direction or
annual returns. Institutional Shareholder Services, which advises
institutional shareholders on such votes, says it now generally
favors proposals like the one at eBay.
Additionally at the meeting, shareholders elected all 15
directors nominated by eBay, including Jonathan Christodoro, an
associate of investor Carl Icahn.
EBay plans to spin off payments unit PayPalin this year's third
quarter, to create two publicly traded companies. The plan was
prompted in part by pressure from Mr. Icahn, who argued that the
company was worth more as two separate entities. The independent
PayPal won't immediately have a proxy-access policy.
There are roughly 80 proxy access proposals going before
shareholders this year, according to Carol Bowie, the head of ISS's
Americas research group. "There are very few institutional
investors that don't support some form of proxy access," she
said.
Ms. Bowie said less than 10% of S&P 500 companies today have
proxy access procedures in place.
Write to Greg Bensinger at greg.bensinger@wsj.com
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