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Proxy adviser Glass Lewis opposes SoftBank Group board nomination

06/15/2020 | 09:51pm EDT
FILE PHOTO: The logo of SoftBank Group Corp is displayed at SoftBank World 2017 conference in Tokyo

By Sam Nussey

Proxy adviser Glass Lewis has urged SoftBank Group Corp shareholders to vote against the nomination to the board of a new outside director, in a sign of dissent with Chief Executive Masayoshi Son's proposed corporate governance changes.

Glass Lewis opposes the nomination of Lip-Bu Tan, saying he is "overboarded". Tan sits on boards including that of Hewlett Packard Enterprise Co as well as being CEO of chip design software company Cadence Design Systems Inc and chairman of venture capital firm Walden International.

"The time commitment required by this number of board memberships, in conjunction with the executive duties, may preclude this nominee from fulfilling the responsibilities to this company's shareholders," Glass Lewis said in a report.

Neither Tan nor SoftBank immediately responded to Reuters requests for comment.

SoftBank plans to double its number of outside directors to four out of 13 at a shareholder meeting on June 25. The plan follows a torrid year with the group plunging to a record annual operating loss as Son's massive, gut-driven bets on startups such as U.S. office space sharing firm WeWork unravelled.

SoftBank's shareholder meeting is traditionally a congratulatory affair, with proposals passing comfortably and shareholders offering Son praise.

Critics, however, contend the proposals that will be voted on this time will do little to improve checks on Son.

Glass Lewis recommends approving the other proposed new outside director, Yuko Kawamoto, a professor at Waseda Business School who would become the board's only woman, along with the elevation of group Chief Financial Officer Yoshimitsu Goto to the board.

It is also in favour of the reappointment of directors including Rajeev Misra, head of the $100 billion (£79.2 billion) Vision Fund, whose pay doubled last year even as the fund posted a 1.8 trillion yen operating loss.

Proxy adviser Institutional Shareholder Services (ISS) backs all management proposals, including Tan's nomination.

Malaysia-born Tan's venture capital and chip industry background gives him overlap with tech investing behemoth SoftBank, which owns chip designer Arm.

The additions to the board would follow the exit over the last six months of longtime allies of Son - Tadashi Yanai, CEO of Uniqlo parent Fast Retailing Co Ltd, and Jack Ma, co-founder of Alibaba Group Holding Ltd.

(Reporting by Sam Nussey; Editing by Christopher Cushing)


© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
ALIBABA GROUP HOLDING LIMITED 0.14% 177.42 Delayed Quote.-23.77%
CADENCE DESIGN SYSTEMS, INC. 3.35% 165.45 Delayed Quote.21.27%
FAST RETAILING CO., LTD. -2.98% 73250 End-of-day quote.-20.79%
HEWLETT PACKARD ENTERPRISE COMPANY 0.00% 15.49 Delayed Quote.30.72%
KAWAMOTO CORPORATION 19.28% 928 End-of-day quote.-51.46%
SOFTBANK CORP. -0.13% 1531.5 End-of-day quote.18.45%
SOFTBANK GROUP CORP. -2.06% 6574 End-of-day quote.-18.42%
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