AFL-CIO Urges Dell Shareholders to Withhold Vote for Chairman
Dell Inc. institutional shareholders received an electronic letter from labor groups today urging them to vote against Chief Executive Officer Michael Dell as a director at the company’s Aug. 12 shareholder meeting.
Dell, who is chairman and CEO of the world’s third-largest personal-computer maker, has drawn compensation that isn’t commensurate with Dell’s stock performance, and its July 22 settlement of accounting-fraud claims with the Securities and Exchange Commission hasn’t served shareholders’ interests, the AFL-CIO and the American Federation of State, County and Municipal Employees said in a statement.
“Union members’ retirement savings are invested in companies like Dell,” Brandon Rees, deputy director of the AFL- CIO’s office of investment, said in an interview. “Company CEOs need to be held accountable for performance and for allegations of wrongdoing.”
The labor groups’ letter urges hundreds of Dell’s institutional shareholders to cast a “withhold” vote for Michael Dell as a company director at the annual meeting in Round Rock, Texas.
Dell spokesman Jess Blackburn pointed to a July 22 company statement in which director Samuel Nunn, a former U.S. senator from Georgia, affirmed the board’s “unanimous support for Michael Dell’s continued leadership.”
The majority of Dell’s compensation between 2000 and 2009, which the labor letter put at $453.8 million, came from stock options granted in the 1990s and exercised in 2000, 2001 and 2005, Blackburn said. Dell hasn’t received a bonus in four years and hasn’t been granted stock or options awards for six years, he said. Dell’s total compensation in 2010 will be $963,623, according to Bloomberg data.
Dell agreed to pay $4 million personally, and the company agreed to pay $100 million, to help settle U.S. regulators’ claims that the company failed to tell investors about “exclusivity payments” received from Intel Corp. in exchange for not using computer chips made by Intel’s main rival.
Dell fell 19 cents, or 1.4 percent, to $13.42 at 5:20 p.m. New York time in Nasdaq Stock Market trading. The shares have declined 6.6 percent this year.