Some public companies are definitely on the hot seat as shareholders turn up the heat. Retail behemoth Wal-Mart
Wal-Mart's recent bribery scandal has pushed the retailer from one that many ethics-minded investors have traditionally found distasteful to one that's being perceived as downright reprehensible. Some major institutional shareholders like CalSTRS have announced their plans to vote against several members of Wal-Mart's board of directors in light of the recent events.
Corporate governance ratings provider GMI Ratings' Paul Hodgson pointed out that it's very rare for institutions like these to disclose their voting plans ahead of time, so the CalSTRS announcement is significant in itself. Meanwhile, major proxy advisory firms ISS and Glass Lewis both recommended that Wal-Mart shareholders vote against several board members in light of the Mexican bribery scandal. Current CEO Mike Duke and former CEO Lee Scott are both directors in the crosshairs.
Wal-Mart's annual meeting doesn't occur until next week, but it should be interesting to see how things play out. A majority of shareholders can't win a vote against these directors; half of Wal-Mart's shares are owned by the Walton family. However, a significant amount of dissent from other shareholders could send a message if Wal-Mart is willing to heed it.
Some other interesting shareholder vote results are floating around, too. Urban Outfitters
The demand for board declassification (a shareholder-friendly measure that means directors are elected every year instead of on a staggered basis) is gaining momentum. A whopping 98% of Baxter International
Recent vote results at Apache
Results from Wal-Mart's meeting should be interesting indeed. However, the fact that many companies have found themselves on the hot seat as shareholders vote their opinions reveals hope for capitalism after all. Shareholders have remembered their ownership, and they're increasingly demanding proper stewardship from corporate managements and boards of directors.