UPDATE 2-GE shareholders reject proposal to split chair, CEO roles

Wed Apr 24, 2013 2:38pm EDT
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By Ernest Scheyder

April 24 (Reuters) - General Electric Co shareholders rejected a proposal on Wednesday to split the roles of chairman and chief executive, jobs currently held by Jeff Immelt.

The proposal from the American Federation of State, County and Municipal Employees (AFSCME) pension plan failed at the company's annual shareholder meeting in New Orleans, receiving roughly 25 percent of shares voted.

Roughly 77 percent of GE's 10.4 billion shares were voted at the meeting.

The movement to split the two roles gained steam across corporate America after the 2008 financial crisis as a way to increase management accountability. A broader push for independent boards began with passage of the Sarbanes-Oxley Act in 2002.

GE, the AFSCME argued, needs an independent chairman who can check a CEO's power and hold the executive accountable.

"Shareholder value is enhanced by an independent board chair who can provide a balance of power between the CEO and the board and support strong board leadership," the group said in a proxy filing.

GE's current board argued its current system worked "because it allows one person to speak for and lead the company and board while also providing for effective oversight and governance."   Continued...