Interest grows in independent shareholder forums
Sep 13, 2007
Leading host looks for additional support
UPDATED on Sept. 17
NEW YORK -- Shareholders and management normally hash out issues at
management-run meetings or analyst conferences, but there's a growing
interest in tackling issues in independent shareholder forums. Gary Lutin, a
champion of such investor programs, is now running a forum focused on
Verizon, while getting requests to do more.
The interest is coming from surprising sources: the companies themselves.
Lutin, president of the investment bank Lutin & Co., says four large-cap
companies and one small-cap have just approached him about hosting forums
for their firms.
'A few corporate managers have realized that an independent exchange of
views with investment professionals is exactly what they try to do through
investor relations research and perception consultants,' he says. 'Forum
programs are essentially just another way for managers and investors to
understand their common interests in a company's competitive success.'
Meanwhile, Lutin, who has run forums for companies such as Amazon and
Computer Associates outside management's orbit since 1999, is looking for
ongoing support from a wider swath of the investment community. 'I'm willing
to commit to one or two programs per year, but you really need to
institutionalize both the support and administration to fairly service
everyone who wants a forum.'
The New York Society of Securities Analysts (NYSSA), which actually
conceived the idea of the shareholder forum in a neutral setting in 1999,
did step up to host one of the Verizon shareholder meetings in August.
Executive director Alvin Kressler says the NYSSA may do more. 'There is an
opportunity for us. I don't think we'd have a role to play where it was a
battle over shareholder proposals. But we are interested in discussions on
issues that go beyond a single company.'
The Verizon discussion has broad implications. Investors and analysts have
come together to ask the company to disclose metrics that will help
determine executives' confidence in their costly bet on a fiber-optic
network. Their efforts may inspire other challenges to companies that are
also unspecific about performance benchmarks.
Verizon has indicated an interest in attending meetings but, so far, no
representative has. A retired executive, C William Jones, president and
executive director of the Association of BellTel Retirees, a group of
110,000 former Verizon employees, is an active participant. A frequent filer
of proxy proposals, Jones says he worried about whether his presence would
hurt the forum, but wants to remind Verizon he is 'not on a headhunting
Lutin has explored institutionalizing the shareholder forum concept, perhaps
in a not-for-profit structure with support from corporate and investor
constituencies: 'The need for a broadly supported forum institute has been
discussed for years. There are many more companies whose shareholders could
benefit from a forum program if the resources were available.
Verizon forum updates are posted on
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