Despite a couple dozen protestors sporting "Make Ethical iPhones" signs, the mood at Apple's annual shareholders meeting, held Thursday morning at the company's Cupertino campus, was celebratory--both for shareholders in general and for some shareholder activists.
The standing-room-only meeting attracted hundreds of shareholders, as both Apple's campus auditorium and the first video-feed overflow room were full before the meeting's 10 a.m. start time. The company used shuttles to take shareholders who didn't fit in the first two rooms to an additional viewing area.
New director-election rules
As is customary, the first part of the meeting focused on official business--namely, the reelection of members of the company's board of directors, and voting on a slate of other proposals, two from management and four from shareholders. But even before that began, Bruce Sewell, Apple's senior vice president and general counsel, announced a significant change in how the company's board of directors will be elected.
For a number of years, there have been shareholder proposals to require candidates for the board of directors to receive approval from over 50 percent of shareholders. (The current company bylaws allow a candidate running unopposed to be elected based on even a single vote in favor.) As is common in corporations, Apple's board has routinely recommended against the approval of these proposals. However, Sewell announced that, based on preliminary voting results, Apple shareholders overwhelmingly want majority voting, and so the company is going to change its bylaws to honor that preference.
Sewell also explained that because the change requires a number of modifications to the company's articles and bylaws, the new policy will go into effect next year. However, he added that each current director had voluntarily agreed to resign if he or she did not receive the approval of a majority of shareholders. In the question-and-answer session later in the meeting, a representative from CalPERS (the California Public Employees' Retirement System), the sponsor of the proposal, applauded the move, saying it was a win for democracy in corporate governance.
None of the current directors was at risk of losing a spot on the board, however, as in preliminary voting, each received over 80 percent of shareholder support. Specifically, Tim Cook received 98.2 percent; Ronald Sugar, 97.9 percent; Robert Iger, 97.8 percent; Andrea Jung, 94.0 percent; William Campbell, 88.6 percent; Millard Drexler, 88.2 percent; Arthur Levinson, 84.0 percent; and Al Gore, 81.4 percent.
Sewell also announced the results of preliminary voting for six other proposals (PDF link), with proposals approving of the current executive compensation report and the aforementioned majority voting passing; proposals on requiring conflict-of-interest reports, shareholder input on director pay, and reports on political contributions and expenditures failed.
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