by TK Kerstetter for The Board Blog, March 31st, 2011.
I mentioned in my last post that I wanted to finish my rant talking about the Apple board. Actually I really don’t want to rant. Rather, what I am trying to do, using Apple and its board as my case study, is get my arms around what position I should take when I see investors pushing for change when a company has performed beyond anyone’s reasonable expectations. As illustrated in our current issue of Corporate Board Member and referenced in my last post, Apple was the top performer by shareholder return for large companies over the last 5 years, and we could find no performance correlation associating governance issues with bottom-line performance. Yet Apple and its board was the target for shareholder proposals requiring an expanded CEO succession disclosure as well as a move from plurality to majority voting for election of directors. And unfortunately, it doesn’t stop there. The front page of the Wall Street Journal’s Money and Investing section on January 18 featured an article on Apple with comments from Delaware Investment’s Christopher Bonavico expressing deep frustration over Apple’s failure to pay a dividend or buy back shares with a 50+billion cash stockpile on Apple’s balance sheet. Ironically, the article has him raving over Apple’s performance in nearly the same breath.
I guess in its most simplistic form, if I was a regular Apple shareholder, should I be happy, upset, or indifferent about my fellow shareholders rocking the boat?
Here is where I come out, coupled with some corporate meanderings… (continue reading… )