Evelyn Davis Continues Fight for Cumulative Voting

Indefatigable activist Evelyn Y. Davis will revisit several high profile annual meetings in 2009, mostly to present the shareholder proposal she has long championed that urges boards to adopt cumulative voting in director elections.

Companies that have received the resolution include Aetna, American Express, AMR, Bank of New York Mellon, Becton Dickinson, Delta Airlines, Goldman Sachs, Home Depot, Loews, Safeway, and U.S. Airways Group. Davis also filed the proposal at Merrill Lynch, recently acquired by Bank of America, and Fannie Mae, which is now under government control and may not have a shareholder meeting this year.

Virtually all the proposals Davis filed for 2009 meetings are resubmissions, including the one she introduced a couple of years ago, which seeks a commitment from companies to provide paper stock certificates to shareholders who request them. NYSE Euronext received that resolution again, although the company persuaded the Securities and Exchange Commission it could be excluded from the proxy (as ordinary business) in 2007.

Davis also resubmitted a board declassification proposal to Boston Properties, where the same resolution has received majority support from votes cast for five consecutive years, despite management’s opposition, including an impressive 86.9 percent in 2008. Aside from declassification proposals, only a couple of Davis’s resolutions have garnered majority votes over the years (including an anti-greenmail proposal at Walt Disney in 2005 and cumulative voting proposals at Aetna and the Bank of New York Mellon, in 2005 and 2006, respectively). But her key governance proposals generally receive significant support, and she continues to command the attention of some top leaders. Davis’s 2008 highlights include lecturing at the Yale School of Management and a guest seat at the table of Bank of America CEO Kenneth Lewis when he was recently honored by American Banker as “Banker of the Year.”

For 2009, Davis also refiled proposals seeking more disclosure about executive compensation (at Bristol-Myers Squibb, Comcast, and Con Edison) and to prohibit stock options, at Continental Airlines, Pfizer, and Verizon. Stock analysts “have their own agendas,” she says, so top executives’ pay should not be tied too closely to the company’s stock price. Davis also objects to any new “golden parachutes” or signing bonuses for executives, but says she evaluates other aspects of executive pay strictly on a case-by-case basis, relative to company performance.

Perhaps the best known “retail” shareholder activist, Davis is critical about the impact of the SEC’s “notice and access” rule, which has led to a decline in proxy voting by individual investors. Receiving electronic proxies should be an “opt-in” not an “opt-out” decision, she argues. But the outspoken activist has little sympathy for fellow shareholders suffering from the precipitous market decline in 2008. Calling herself “cash rich,” Davis says she keeps only a small percentage of her assets in stock, though clearly enough to keep her busy during proxy season.

this news is originally from http://blog.riskmetrics.com