Shareholder Group, Labor Advocates Back Call for CEO Succession Plan at Apple

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An Apple shareholders' proposal presses for CEO succession plan transparency.
An Apple shareholders' proposal presses for CEO succession plan transparency.

Institutional Shareholders Service, an independent proxy-advising service, and the Laborers’ International Union of North America have endorsed a shareholders’ proposal to require Apple, Inc. to disclose a succession plan for Chief Executive Officer Steve Jobs, according to a report Thursday at Bloomberg’s Businessweek.

Apple shareholders will consider the proposal, which would mandate Apple’s board disclose a CEO succession plan annually, at the next shareholders’ meeting on February 23.

Jobs announced his most recent medical leave of absence from the company on January 17, which led to new rounds of speculation in the media and blogosphere as to the Apple CEO’s health and his long-term prospects for continuing to lead the giant technology enterprise.

Tim Cook, Apple’sChief Operating Officer, has taken over responsibility for day-to-day operations in Jobs’ absence, but the board has offered no guidance as to who might take over in the event Jobs is unable to return to work.

“A vote for the shareholder proposal to adopt a succession planning policy is warranted in light of the company’s limited disclosure regarding this issue and the market’s expression of concern over CEO succession at Apple,” Rockville, Maryland- based ISS said in a report dated Jan. 28. The laborers’ union announced the group’s support in a statement Thursday.

The company opposes the proposal and asked shareholders to vote against it in a proxy statement released January 7. Apple’s governance guidelines require the board and CEO to annually review succession planning for senior management, a confidential process that includes identifying candidates for succession, according to the Businessweek report.

Official opposition to the succession disclosure proposal is founded on a belief that information could provide unfair business advantages to Apple’s competitors and provide an opportunity to poach executives. The proposal also could harm the company’s ability to retain executives by identifying those being considered for positions and how they are being evaluated, Apple said.

[Bloomberg]