By Jim Mackinnon
Beacon Journal business writer
Goodyear should have an independent board chairman — separate from any senior executive position — according to a shareholder proposal that will be voted on at the Akron tire maker’s annual meeting Monday at the Hilton Akron/Fairlawn.
Shareholders also will vote on electing 12 directors to one-year terms, a nonbinding “say on pay” executive compensation resolution, and on naming PricewaterhouseCoopers LLP Goodyear’s public accounting firm.
The shareholder proposal calling for an independent board chairman is opposed by Goodyear Tire & Rubber Co.’s full board.
The shareholder proposal argues that separating the board chairman and chief executive officer roles creates better accountability of the CEO. John Chevedden, a well-known shareholder activist from California, placed the proposal on the proxy ballot.
“When our CEO is our board chairman, this arrangement can hinder our board’s ability to monitor our CEO’s performance,” the proposal argues in part. Having an independent board chairman is the prevailing philosophy in the United Kingdom and elsewhere, the resolution said.
Goodyear said it opposes the shareholder resolution in part because it already has a lead independent board member in place “with clearly delineated and comprehensive oversight responsibilities.”
The current board structure also has led to Goodyear having record financial performance with Rich Kramer as board chairman and CEO, the company said. “The board’s approach is consistent with that of most large, publicly traded companies in the United States,” Goodyear said in the proxy statement.
PricewaterhouseCooper’s Center for Board Governance said that as of 2012, 43 percent of S&P 500 company boards separated the role of chairman and CEO.
“Separating the board chair and CEO roles remains an ongoing debate in corporate governance with compelling arguments on both sides,” the center said at its website.
In 2013, there were a majority of votes cast at five of 58 Russell 3000 companies in favor of separating the roles, the center reported. There has been growing interest recently among investors and others in separating the roles, the center said.
Goodyear is in favor of a nonbinding “say on pay” resolution that is also on the shareholder ballot.
Kramer will review Goodyear’s fiscal performance and take questions from the audience, company spokesman Keith Price said.
The annual meeting is scheduled to start at 4:30 p.m. in the hotel at 3180 W. Market St. in Fairlawn.
Jim Mackinnon can be reached at 330-996-3544 or email@example.com.