ISS backs investor Elliott Management's nominees to Hess board

Fri May 3, 2013 6:21am EDT

May 3 (Reuters) - Influential U.S. proxy advisory firm ISS asked Hess Corp's shareholders to elect five new board members nominated by activist hedge fund Elliott Management, a day after another proxy firm, Glass Lewis, made a similar recommendation.

Elliott Management, which owns a 4.5 percent stake in the oil and gas company, has asked Hess for a number of changes, including the election of independent directors to the board, to increase shareholder value.

Hess raised its dividend and initiated a $4 billion share buyback in March in an effort to boost shareholder returns, but has failed to pacify the activist investor.

"In reaching its conclusion, ISS acknowledged the serious lack of oversight and accountability at the board level at Hess," Elliott Management said in a statement on Friday.

Hess has made a number of moves to become a pure play exploration and production company in the past year, including selling its refining and retail businesses.

The company plans nominate six new directors at its annual meeting in May in response to criticism that its current board lacks independence.

Hess responded to Glass Lewis' recommendations on Thursday by urging shareholders to elect its nominees.

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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