M&S chairman wins vote to stay

Wednesday, 09 July 2008
Marks and Spencer executive chairman Sir Stuart Rose has won a shareholder vote to reappointment him, even though 22% of investors did not back him. According to the BBC, the level of opposition, with 6% voting against and 16% abstaining, was described as "significant" by critics. Sir Stuart faced opposition over his role that combines the jobs of both chairman and chief executive. Critics said combining both roles broke corporate governance rules, as one person had too much power at the firm. Corporate governance consultants PIRC said the vote "demonstrates the depth of investor unease".

"The vote is a clear signal from M&S shareholders that they have serious reservations about the company's decision to ignore well-established best practice," said PIRC managing director Alan MacDougall.

So far this year, an average of only 2% of shareholders of FTSE 100 companies have opposed the re-election of its directors.

During the meeting, Sir Stuart defended his role to the company's investors, insisting that the board's "strong, independent and challenging" non-executive directors would keep him in check.

Supporting Sir Stuart, M&S deputy chairman Sir David Michels said: "He unquestionably has the right set of skills to take Marks and Spencer forward and to complete the job he has started."

In a letter to shareholders in April, M&S said appointing a new chief executive in 2008 or 2009 to replace Sir Stuart "was likely to be a damaging and unwelcome distraction at precisely the time that the business needed clear leadership to sustain its recovery and transformation".

Last week, M&S' shares fell almost 25% after Sir Stuart said that the company faced up to two years of difficult economic conditions that will hit its profits.

Image: M&S

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