CAMBRIDGE, Mass.--(BUSINESS WIRE)--The State Board of Administration of Florida (the "SBA"), the investment manager of the Florida Retirement System, and the American Corporate Governance Institute (the "ACGI") are pleased to announce their success in contributing to board declassification in seven S&P 500 companies.
During the 2010-11 proxy season, the SBA, with the assistance of the ACGI, submitted shareholder proposals to repeal the classified boards of a number of companies for a vote at their 2011 annual meetings. The SBA and the ACGI subsequently negotiated and reached agreements with seven companies, pursuant to which each company will bring a management proposal to declassify its board of directors. The declassification of the boards of these companies would produce a 5% reduction in the number of S&P 500 companies with a classified board.
The seven companies (and the annual meeting at which the management declassification proposal is expected to be voted upon) are as follows:
- Biogen Idec Inc. (NASDAQ: BIIB) (2011 annual meeting);
- Dean Foods Company (NYSE: DF) (2012 annual meeting);
- E*TRADE Financial Corporation (NASDAQ: ETFC) (2012 annual meeting);
- Fiserv, Inc. (NASDAQ: FISV) (2012 annual meeting);
- National Oilwell Varco, Inc. (NYSE: NOV) (2011 annual meeting);
- NVIDIA Corporation (NASDAQ: NVDA) (2011 annual meeting); and
- Ross Stores, Inc. (NASDAQ: ROST) (2011 annual meeting).
"These seven companies have been willing to engage in a dialogue with the SBA and the ACGI, and have demonstrated responsiveness to shareowners’ concerns about classified boards" said Michael McCauley, Senior Officer with the SBA. "We believe that moves to annual elections are likely to result in greater director accountability, and consequently should improve firm performance and value."
"We are pleased that our work on behalf of the SBA has contributed to board declassification in these S&P 500 companies," stated Lucian Bebchuk, President of the ACGI. "Empirical studies suggest that classified boards could be associated with lower firm valuation and poor corporate decision-making."
The State Board of Administration of Florida is an agency of Florida state government that provides a variety of investment services to various governmental entities. These include managing the assets of the Florida Retirement System (FRS) Pension Plan (i.e., defined benefit plan) and Investment Plan (i.e., defined contribution plan), the Lawton Chiles Endowment Fund, Florida PRIME, the Hurricane Catastrophe Fund, the Lottery Fund and a variety of smaller funds. Total assets under management as of December 31st, 2010 were approximately $158.9 billion.
The American Corporate Governance Institute, LLC is a research and advisory organization that seeks to contribute to improving corporate governance and accountability in publicly traded companies.