MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Monday, December 8, 2003 Mega Pension Plans Gang up on Putnam Four retirement plans are planning to nominate alternative directors for the board of Marsh & McLennan Companies Inc. The pension funds are planning the proxy battle in response to the scandals uncovered at Putnam Investments by Massachusetts Secretary of State William Galvin in October. Marsh & McLennan is the parent company to Putnam Investments. The AFSCME Employees Pension Plan, New York State Common Retirement Fund, California Public Employees' Retirement System and the California State Teachers' Retirement System said they are targeting the board for its "failure to properly control its money management business and for its severe lack of independent board leadership." Together the four pension systems hold 6.85 million shares of Marsh McLennan worth $306 million. That works out to about 1.3 percent of the company they say. "Marsh & McLennan deserves to be the first company in U.S. history to face a binding proxy access proposal because of its gross failure to have proper controls that could have prevented the Putnam disaster," said Gerald W. McEntee, chairman of the AFSCME Employees Pension Plan. "It is tragic that the board at Marsh & McLennan lacked the independence needed, and today continues to be influenced more by its insiders than the needs of its shareholders. There is no question that shareholders will support the idea of electing a truly independent director to the board if given the opportunity through our shareholder resolution." Alan G. Hevesi, New York State Comptroller and sole trustee of the New York State Common Retirement Fund noted that investors have pulled more than $32 billion from Putnam since the scandal broke and that March & McLennan's stock price is down by more than 10 percent. "I can't think of a stronger case worthy of shareholder involvement, and I have no doubt, that given the chance, shareholders will respond favorably to our initiative," he said. Sean Harrigan, president of CalPERS added that Putnam and Marsh & McLennan's problems are "Enronesque" in nature. He added that "The excessive compensation received by and promised to Lawrence Lasser is outrageous." Jack Ehnes, chief executive officer of CalSTRS said the sponsors are also concerned about the lack of independent board membership. "This board isn't meeting the needs of shareholders. Now it is time for shareholders to do more than send a message of our dissatisfaction. We must be allowed to use the same process that the company does to elect truly independent directors, who will listen to the shareholders -- the real owners of the corporation." Printed from: MFWire.com/story.asp?s=6299 Copyright 2003, InvestmentWires, Inc. All Rights Reserved |