An activist investor group said Thursday it has backed off of a request that Bank of America give shareholders a vote on whether the chairman and CEO roles should be combined.
In exchange for withdrawing the proposed resolution on the issue, the Charlotte-based bank has agreed to produce a report on its business standards, said the Rev. Seamus Finn, chairman of the New York-based Interfaith Center on Corporate Responsibility.
The center had pushed for the resolution after the bank in October gave the chairman’s title to CEO Brian Moynihan. In making Moynihan chairman, the bank rolled back a bylaw change approved by shareholders in 2009 to separate the titles.
Proponents of splitting the chairman and CEO roles say it provides a better check on management.
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Finn said he’s now OK with Bank of America making Moynihan chairman, after discussing the issue further with the bank. In defending its decision to the center, Finn said, the bank pointed out that Moynihan, who took over in 2010 after CEO Ken Lewis retired, oversaw the bank’s recovery from the financial crisis and back to “a position of respect in the community.”
“They saw our resolution as wanting to punish him,” Finn said. “Having listened to their presentation, they’re willingness to talk to us twice on the subject ... I thought their arguments were solid. I’m willing to give them enough space to show that it was the right decision.”
Bank of America spokesman Jim Mahoney confirmed that the agreement with the center, which was first reported by Reuters.
The center is a coalition of faith-based institutions and other large holders of various public company shares. Shareholders would have voted on the proposed resolution at the bank’s upcoming annual meeting in the spring.
Finn said the center had asked the bank a year ago to produce a report on its business standards, but the bank had opposed it at that time.
Two pension funds have also asked Bank of America to hold a shareholder vote on the bylaw change, but they didn’t submit a formal shareholder proposal. Last month, the California State Teachers’ Retirement System and the New York City Comptroller’s office said they were engaged in discussions with the bank.
Aftercombining the chairman and CEO roles again, the bank made board member Jack Bovender Jr. its lead independent director. Staff writer Rick Rothacker contributed.