Allow Proposal Topic That Won Our 51/5-Plus Yes Vote at 4 Consecutive Annual Meetings
Shareholders recommend that
each director be elected annually. This proposal recommends that our companys governing documents be amended accordingly. This includes the bylaws.
Strong Institutional Investor Support
Twenty-five (25) proposals on this topic won an overall 63% approval rate at major companies in 2002. Annual election of each director is a Council of Institutional Investors www.cii.org core policy. Another CII policy is the
adoption of shareholder proposals that win a majority of votes cast as this proposal topic did in 2000 and 2001. Institutional investors own 68% of Maytag stock.
Our 51%Plus Yes Votes in 1999, 2000, 2001 & 2002
This proposal topic won more than 51% of our yes-no vote at each of our 1999, 2000, 2001 and 2002 annual meetingsincluding our 57%-yes vote in 2002.
Shareholder resolutions should be binding
Shareholder resolutions should be binding according to
in The Best & Worst Boards cover-page report,
October 7, 2002.
Votes equally valuable
Shareholders believe that, consistent with our directors accepting our yes for their own election in 4-consecutive years, our directors
should give equal value to our yes-votes for shareholder proposals.
Shareholders have no assurance that our management will not again spend shareholder money on unnecessary solicitations touting managements stand on this topic, as our management did in 2000. The 4-consecutive 51%-plus yes votes
were won without any solicitation by shareholders.
Staggered board combined with a poison pill
Certain independent proxy analysts are particularly concerned about 3-year
director terms, combined with poison pills. Source: Annual Meeting Report, Northrop Grumman, April 1999, IRRC. Our management is further sheltered by strong state anti-takeover provisions.
Serious about good governance
Enron and the corporate disasters that followed forced many companies to get serious about good governance in my view. This includes electing each director annually. When the buoyant stock market
burst, suddenly the importance of governance was clear. In a time of crises, a vigorous board can help minimize damage.
A look back at
inaugural ranking of the best and worst boards in 1996 tells the story. For the 3 years after the list
appeared, the stocks of companies with the best boards outperformed those with the worse boards by 2 to 1. Increasingly, institutional investors are flocking to stocks of companies perceived as being well governed and punishing stocks of companies
seen as lax in oversight.
To protect our investment money at
Elect Each Director Annually