Apple succession plan proposal gets proxy firm's backing
Advisory firm Institutional Shareholder Services announced its support for a proposal that would ask Apple to produce a written CEO succession policy. Apple shareholders will vote on the proposal at the company’s annual meeting later this month in Cupertino.
The proposal submitted by the Central Laborers’ Pension Fund asks that Apple’s board of directors adopt and disclose a detailed succession planning policy that would require annual public reports on succession planning. Apple’s board opposes the proposal. In a January filing with the Securities and Exchange Commission, the company said it’s already implemented succession planning. Publicly disclosing succession information would give competitors an unfair advantage and hurt efforts to recruit and retain executives, Apple argues.
The succession proposal is coming under new scrutiny after Apple CEO Steve Jobs announced he was taking a medical leave of absence from his day-to-day duties. It’s the second leave of absence since 2009 for Jobs, who has battled pancreatic cancer and undergone a liver transplant in recent years. Chief operating officer Tim Cook is currently overseeing Apple’s day-to-day operations in Jobs’s absence.
Institutional Shareholder Services’s support of the succession plan proposal was announced Thursday by the Laborers’ International Union of North America. In its statement, ISS said that disclosing a succession plan would benefit Apple shareholders, allowing them to “judge the board on its readiness and willingness to meet the demands of succession planning based on the circumstances at that time.”
ISS is a leading advisory firm for institutional investors that’s weighed in on Apple matters in the past. Four years ago, the proxy advisory firm recommended that Apple shareholders withhold votes to retain Apple’s board of directors after a stock-option backdating probe by the SEC.
The succession policy is one of two shareholder proposals to be considered at Apple’s February 23 annual meeting. Another proposal by the California Public Employees’ Retirement System would change the voting standard for uncontested board of director elections. Apple’s board also opposes that proposal.
Other matters before the shareholders on February 23 involve re-electing the current board of directors, including recently appointed director Ronald Sugar. Shareholders will also vote on whether to ratify accounting firm Ernst & Young as Apple’s auditor and give an advisory vote on executive compensation.