Verizon announced today that a new policy that requires shareholder approval of any new agreements with senior executives that provide for cash severance payments in excess of 2.99 times the sum of the executive’s salary plus annual short-term bonus.
This proposal was submitted at the April 2003 Annual Meeting of Shareholders by the Association of BellTel Retirees and Association board member Robert Rehm. It garnered an almost unbelievable 59% vote from the shareholders. However, this shareholder vote was not binding and the company could have chosen to ignore it. In recent weeks the Association has been attempting to determine what the company planned to do so that we could map our strategy for the next year.
If the company had ignored the mandate of the shareholders, we would have submitted a new proposal demanding a change in the policy. Had we won that proposal, as we most assuredly would have, the proposal calling for a policy change would have been binding.
The company did the right thing, especially in view of the recent corporate scandals. The process was begun just after the shareholder meeting by the Human Resources Committee of Verizon’s Board of Directors. It is effective immediately.
The Association thanks all of its members for helping to bring home this impressive victory.
Stay tuned.
Bill Jones
Executive Director & President
Association of BellTel Retirees Inc.