By Braden Reddall
June 5 A majority of Nabors Industries Ltd shareholders voted for the right to officially nominate board directors, following a year of upheaval over the company's executive compensation and defeat of such a measure at the national level.
The proposal asks Nabors, owner of the world's largest land-drilling fleet, to adopt a bylaw allowing holders of 3 percent of its stock for three years to nominate directors for up to 25 percent of the board in the official "proxy" voting materials.
This is similar to what the U.S. Securities and Exchange Commission (SEC) sought to impose on all U.S.-listed companies before that was blocked by a federal court last year.
The New York City comptroller's office, which proposed the non-binding resolution, said after the Nabors annual meeting in Bermuda on Tuesday that the Nabors vote was the first time such a measure had received majority support since the SEC measure was blocked.
"It serves as irrefutable evidence that the investment community wants reasonable proxy access rights for substantial, long-term shareowners," New York Comptroller John Liu said in a statement. "In the immediate term, Nabors can help restore the confidence of its investors by adopting the proposal."
A Nabors spokesman said a final tally of its shareholder votes would be released later this week, but did not make any immediate comment on the specific proxy access issue.
Nabors had argued for a vote against the proposal since shareholders can already recommend candidates to the board for review by its nominating committee, which was "better suited than an individual shareholder" to make such decisions.
Such a proposal could result in a divided board, Nabors said. "The best results for shareholders are obtained when directors, elected to make significant strategic decisions, act together constructively to create shareholder value," it added.
At last year's Nabors annual meeting, a majority of shareholders voted against its executive pay. Gene Isenberg, the Bermuda-based company's famously well-paid chief executive, stepped down later in the year. The SEC then launched an informal inquiry into Nabors executive benefits.
Earlier this year, Isenberg gave up a $100 million payment linked to his resignation as CEO.