Home / International News / News detail

GM holders to eye greenhouse gas proposal

From Reuters| June 05 , 2007 10:47 BJT

General Motors Corp. shareholders are set to vote Tuesday on proposals to give investors more influence on voting for board members, recouping bonuses when results are restated and on reducing greenhouse gas emissions.

One non-binding proposal that would allow GM (Charts, Fortune 500) investors to cast votes for board members equal to the number of shares held received 54 percent of the vote in favor last year, and it will be voted on again this year at the company's annual shareholder meeting.

"We would like more of a say on who gets on that board," John Lauve, a GM shareholder from Holly, Mich., said in an interview.

Last February, GM cut its dividend by half due to pressure from Jerry York, aide to Kirk Kerkorian, then GM's largest individual shareholder. York was also given a board seat.

"We would certainly like to see more of a dividend," said Lauve, 66, who worked at GM for 30 years and retired in 1999.

Kerkorian subsequently sold all his GM shares and York stepped down from the board after failing in an effort to forge an alliance between GM and Nissan-Renault.

GM's shares, which lost half their value in 2005, jumped 58 percent last year, the biggest of any of the 30 companies in the Dow Jones industrial average.

The automaker, which is in the middle of a restructuring that includes slashing more than 34,000 jobs and closing 12 plants, cut $9 billion in costs in 2006.

Investors gained confidence in GM's turnaround as its annual net loss narrowed to $2 billion from $10.4 billion in 2005. But the stock's down about 2 percent so far this year. GM has struggled along with its competitors Ford (Charts, Fortune 500) and Chrysler, which is being sold by its German parent, DaimlerChrysler (Charts) to private equity firm Cerberus Capital Management.

Another proposal shareholders plan to repeat this year calls for recouping executive bonuses when results are later restated lower.

"GM's current policy recalls the bonus only for the person responsible for the restatement," Lauve said. "But we want a policy that recoups bonuses from everyone who was awarded one because of the inflated results."

GM, which pledged to tighten its financial controls after twice restating results and delaying its fourth-quarter report, said last month that U.S. securities regulators were reviewing its accounting for foreign exchange and commodity derivatives and that a similar hedge-related probe into its former finance arm could force it to restate results again.

GM filed its annual report in March after a six-week delay, which it blamed on recurring accounting problems, and said its internal controls on financial reporting had been ineffective.

Another proposal, from the Connecticut State Treasurer's office and more than a dozen members of the Interfaith Center on Corporate Responsibility - an association of 275 faith-based institutional investors - calls for GM to set greenhouse gas reduction goals for its operations and vehicles, and report back by Sept. 30 on plans for achieving the goals.

The proposal comes as GM launches an advertising campaign against legislative proposals to raise fuel economy standards.

Connecticut Treasurer Denise Nappier said his concerns were related to long-term shareholder value.

"Leading investors worldwide recognize climate change as a substantial business risk, particularly to the auto industry," he said. "GM cannot continue to ignore the fact that it is in the best interest of the company, and its investors, to recognize and address the financial implications of climate change."

Gasgoo not only offers timely news and profound insight about China auto industry, but also help with business connection and expansion for suppliers and purchasers via multiple channels and methods. Buyer service:buyer-support@gasgoo.comSeller Service:seller-support@gasgoo.com

All Rights Reserved. Do not reproduce, copy and use the editorial content without permission. Contact us: autonews@gasgoo.com