Bank of America shareholders should force Chief Executive Officer Brian Moynihan to give up his chairman title, says a group that advocates for pension funds affiliated with labor unions.
The bank is holding a Sept. 22 vote to approve bylaw changes that allowed Moynihan to add the chairman title last year. The Charlotte-based lender took a “big step backwards” when it replaced its independent chairman with a lead director, CtW Investment Group said in a letter posted on its website Friday.
“Bank of America’s decision to unilaterally amend the bylaw, apparently after a ‘thorough and thoughtful process,’ displays a shocking lack of awareness,” CtW said in the letter. “Eliminating the independent chairman’s role raises unnecessary risks for shareholders without demonstrable benefits.”
Lawrence Grayson, a spokesman for Bank of America, declined to comment. Proxy advisers Institutional Shareholder Services Inc. and Glass Lewis & Co. probably will wait until early September to issue their recommendations.
In a filing this month, the bank’s board praised Moynihan’s leadership and recommended investors ratify the bylaw change. Still, the lender has said it will “promptly implement” a plan to find an independent chairman if a majority oppose the decision that gave Moynihan both top jobs.
CtW advocates for union-affiliated pension funds that collectively manage more than $200 billion, according to its website. The firm was involved in the 2009 shareholder amendment that mandated an independent chairman at Bank of America, the second-largest U.S. lender.
The Wall Street Journal reported CtW’s letter earlier Friday.