INTERNATIONAL BUSINESS MACHINES (IBM) CORPORATION | Independent board chairman at INTERNATIONAL BUSINESS MACHINES CORPORATION

Status
25.94% votes in favour
AGM date
Previous AGM date
Proposal number
5
Resolution details
Company ticker
IBM
Lead filer
Individual
Resolution ask
Adopt or amend a policy
ESG theme
  • Governance
ESG sub-theme
  • CEO / chair duality
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Technology
Company HQ country
United States
Resolved clause
Shareholders request that the Board of Directors adopt an enduring policy, and amend the governing documents as necessary in order that 2 separate people hold the office of the Chairman and the office of the CEO as follows:
Selection of the Chairman of the Board: The Board requires the separation of the offices of the Chairman of the Board and the Chief Executive Officer.
Whenever possible, the Chairman of the Board shall be an Independent Director.
The Board has the discretion to select a Temporary Chairman of the Board who is not an Independent Director to serve while the Board is seeking an Independent Chairman of the Board.
Although it is a best practice to adopt this policy soon this policy could be phased in when there is a contract renewal for our current CEO or for the next CEO transition.
Supporting statement
Kenneth Steiner, 14 Stoner Ave., Great Neck, NY 11021, the owner of at least 100 shares of IBM stock, intends to submit the following proposal at the meeting:

This proposal topic won 52% support at Boeing and 54% support at Baxter International. Boeing then adopted this proposal topic in June 2020. The roles of Chairman and CEO are fundamentally different and should be held by 2 directors, a CEO and a Chairman who is completely independent of the CEO and our company.
A lead director is thus no substitute for an independent board chairman. With the current CEO serving as Chair this means giving up a substantial check and balance safeguard that can only occur with an independent Board Chairman. A lead director cannot call a special shareholder meeting. A CEO/Chairman can overrule a lead director’s input.
A lead director can delegate many details of his lead director duties to management and then simply rubber-stamp it. Management has not explained how shareholders can be sure of what goes on in regard to lead director delegation.
Perhaps there should be a rule against a person who has been a CEO and a Chairman being named as Lead Director. Mr. Alex Gorsky, IBM Lead Director has years in the simultaneous positions of being a CEO and Chairman. Past and present holders of both roles would seem to have a special bond which is inconsistent with the oversight role of a Lead Director. There is clearly a need for a change because the IBM stock price was at $156 five years ago.
This proposal topic won 41% shareholder support at the 2021 IBM annual meeting. This 41% support could represent more than 51% support from the shares that have access to unbiased proxy voting advice. IBM management resistance to this proposal topic may be getting a free ride on the backs of small shareholders who do not have access to unbiased proxy voting advice. For a large company IBM seems to have a greater than usual percentage of small shareholders who do not have access to unbiased proxy voting advice.
The increased complexities of companies of more than $100 Billion in market capitalization, like IBM, demand that 2 persons fill the 2 most important jobs in the company — CEO and Chairman.

How other organisations have declared their voting intentions

Organisation name Declared voting intentions Rationale
Rothschild & co Asset Management For
Kutxabank Gestion SGIIC SAU. For
KBI Global Investors For

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