SACRAMENTO, CA– The California Public Employees' Retirement System (CalPERS) is seeking shareowner support for its proposal to have unopposed board candidates of Apple Inc. elected by majority vote.
"Apple needs a governance upgrade. An overwhelming 73 percent of shareowners supported this same proposal a year ago, and we're once again calling on Apple to listen to its shareowners and adopt a voting standard that is widely considered a basic mark of good governance," said Anne Simpson, CalPERS Senior Portfolio Manager who leads CalPERS Corporate Governance program. "Nearly 80 percent of the companies in the S&P 500 and 60 percent in the Russell 1000 have some form of majority voting standard, and for good reason. It's a hallmark of accountability."
CalPERS non-binding proposal No. 7 at Apple's February 23 annual meeting calls on the company to require that candidates for uncontested seats receive a majority of votes cast to be elected to the Board of Directors. More than 73 percent of shareowners voting their shares approved a similar CalPERS-backed proposal at Apple's 2011 annual meeting, but the company's Board so far has declined to adopt it.
Apple's current plurality vote rule allows directors to be elected by a single "For" vote, giving shareowners no real ability to oppose a candidate since their "Withheld" votes aren't counted. In its letter to shareowners seeking support for the proposal, CalPERS notes that a growing number of California-based companies, including Cisco Systems, Edison International, PG&E and Sempra Energy, have adopted some form of majority voting, which shows state law is no barrier to good practice as Apple has claimed.
"Plurality voting disenfranchises shareowners," Simpson said. "We urge Apple to take the necessary steps to institute a majority vote standard that allows those of us who are owners of the company to have a voice."
CalPERS owned 2.8 million shares of Apple common stock as of December 27, 2011. For a copy of the shareowner letter, proxy votes and other corporate governance information, visit our Corporate Governance website.
CalPERS is the nation's largest public pension fund with approximately $231 billion in assets, providing retirement benefits to more than 1.6 million State, public school, and local public agency employees, retirees, and their families, and health benefits to more than 1.3 million members. The average CalPERS pension is $2,220 per month. For more information about CalPERS, visit www.calpers.ca.gov.
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Robert Udall Glazier, Deputy Executive Officer
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