* Proxy adviser urges no vote for Massey board members
* Massey accuses shareholder group of political agenda
* Stock down
NEW YORK, May 6 (Reuters) - Shareholders of Massey Energy Co MEE.N, owner of the West Virginia mine where 29 miners died in a blast, should dump three board members over the company's "disturbing" safety track record, a leading proxy advisory service recommends.
The note to shareholders by RiskMetrics/ISS came a day after Massey called for the investigation by federal mine safety officials into the Upper Big Branch mine disaster to be held in public. The company is also the subject of an FBI criminal investigation.
In proxy filings with the U.S. Securities and Exchange Commission, Massey accused one shareholder group of a “political agenda” by calling for three board members not to be reelected at the company’s May 18 shareholders’ meeting.
Massey stock has dropped from a year-high of $54.80 on the day of the blast and on Thursday morning was down 52 cents at $34.45 on the New York Stock Exchange.
Since the deadly April 5 explosion in Montcoal, West Virginia, Massey has been under the microscope for its safety record, with the mineworkers’ union (UMWA) accusing it of putting profits before safety in non-union operated mines.
“Beyond the recent tragedy, the company’s track record of violations and fines is disturbing,” RiskMetrics said in a note to clients obtained by Reuters.
“Massey appears to take action mainly in response to issues identified by shareholders or regulatory agencies,” said the note, dated May 5. It recommended clients withhold votes for board members Richard Gabrys, Dan Moore and Baxter Phillips Jr, who are up for reelection.
“The (Upper Big Branch) explosion put a spotlight on Massey and its leadership, but the issues highlighted in the ‘Vote No’ campaign and ISS’ analysis transcend concerns about this specific tragedy.
“A board that is no longer responsive to shareholders and does not provide sufficient oversight to management is less able to protect or enhance shareholder value,” it said.
The CtW Investment Group, which owns about 1 percent of Massey stock, welcomed RiskMetrics’ thumbs-down of directors. “All three were members of the Massey Safety, Environmental and Public Policy Committee, the board committee ultimately responsible for Massey’s serious and systematic non-compliance with mine safety laws over an extended period,” it said.
It noted that “the catastrophic and preventable mine explosion” not only killed 29 miners but “destroyed over $1.7 billion in shareholder value.”
“Shareholder opinion has shifted firmly against incumbent board members, whose compliance and risk management failures led to the Upper Big Branch mining disaster,” said William Patterson, Executive Director of the pro-union Change to Win.
In an SEC filing on Thursday, Massey released a copy of a letter to Patterson from board member Admiral Bobby Inman, who said the board had asked Gabrys to examine “Massey’s track record on safety, facts related to the UBB tragedy and the related investigations by various agencies including the FBI.”
In a filing on Wednesday, the company accused CtW of “a coordinated pro-union campaign to unseat the current board and management team.”
The company defended its safety record and said the amount of time lost to accidents was better than the industry average for 17 of the last 19 years. “CtW is pushing the violations metric for shock factor not safety purposes as it fits the narrative structure and obscures the political agenda driving the campaign.
“It’s troubling that, in the wake of the current crisis, CtW would threaten to mount a campaign to withhold votes from our three qualified nominees,” Massey’s filing said. (Reporting by Steve James, editing by Gerald E. McCormick)
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