Faith-Based Shareholders Pushes Bank of America to Reverse Poor Governance Decision
November 26th, 2014
The Missionary Oblates have joined other Faith-based investors in asking Bank of America to require the Chair of the Board to remain independent. BOA recently decided to give the title of Chairman to the Bank’s CEO, Brian Moynihan.
BOA’s action rolls back a bylaw change approved by shareholders in 2009 to separate the titles. Faith-based and other large institutional investors, including the California State Teacher’s Retirement System and the New York City Pension Funds, have called for a shareholder vote on the issue. Continuing fines and settlement payments involving the bank since the financial crisis have shareholders arguing for greater oversight of management by the Board. Giving the CEO the additional authority of Board Chair weakens the independence of the Board.
Fr Seamus Finn, OMI who is Board Chair of the Interfaith Center on Corporate Responsibility, said the bank’s ongoing fines and settlements show that it needs “to take a serious look at the culture of the institution.” He said it would be better if the two roles were separated.
The Oblates have joined the New Jersey-based Sisters of Charity in co-filing a resolution on this issue, and other faith-based institutional investors plan to do the same. Press coverage in the Wall Street Journal and other newspapers has analysts predicting that the bank will put the issue on the ballot for a vote by shareholders.