By Ernest Scheyder
April 24 General Electric Co shareholders
rejected a proposal on Wednesday to split the roles of chairman
and chief executive, jobs currently held by Jeff Immelt.
The proposal from the American Federation of State, County
and Municipal Employees (AFSCME) pension plan failed at the
company's annual shareholder meeting in New Orleans, receiving
roughly 25 percent of shares voted.
Roughly 77 percent of GE's 10.4 billion shares were voted at
The movement to split the two roles gained steam across
corporate America after the 2008 financial crisis as a way to
increase management accountability. A broader push for
independent boards began with passage of the Sarbanes-Oxley Act
GE, the AFSCME argued, needs an independent chairman who can
check a CEO's power and hold the executive accountable.
"Shareholder value is enhanced by an independent board chair
who can provide a balance of power between the CEO and the board
and support strong board leadership," the group said in a proxy
GE's current board argued its current system worked "because
it allows one person to speak for and lead the company and board
while also providing for effective oversight and governance."
GE, like Caterpillar Inc and other large
manufacturers, has a lead director that can set agendas at board
meetings, call sessions that exclude management and oversee
corporate governance processes.
The AFSCME said it hasn't decided whether to offer a similar
proposal at GE's next shareholder meeting, but was encouraged
more shareholders voted to split the roles this year than at
2012's meeting. The proposal received about 22 percent of votes
cast at the 2012 meeting, and roughly 25 percent this year.
"There's a growing trend for these type of proposals," said
the AFSCME's John Keenan, who spoke at GE's meeting.
The group is pushing a similar measure at JPMorgan Chase &
Co that shareholders will consider at their annual
meeting next month.
Bank of America Corp and Citigroup have split
chairman and CEO roles in recent years.
GE shareholders also rejected proposals that would have
imposed 15-year term limits on current board members, required
at least two candidates to be nominated for each available board
seat and would have canceled stock options and bonuses for
The Fairfield, Connecticut-based's 17 directors were all
re-elected, including Mary Shapiro, former chairwoman of the
U.S. Securities and Exchange Commission, and W. Geoffrey
Beattie, deputy chairman of Thomson Reuters Corp
, the parent company of Reuters News.
KPMG was ratified as GE's auditor.
GE shares rose 2.1 percent to $21.95 in afternoon trading.