KeyCorp | Independent board chairperson at KeyCorp

Status
36.10% votes in favour
AGM date
Previous AGM date
Proposal number
6
Resolution details
Company ticker
KEY
Lead filer
Individual
Resolution ask
Adopt or amend a policy
ESG theme
  • Governance
ESG sub-theme
  • CEO / chair duality
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Financials
Company HQ country
United States
Resolved clause
Shareholders request that the Board of Directors adopt an enduring policy, and amend the governing documents as necessary in order that 2 separate people hold the office of the Chairman and the office of the CEO.
Supporting statement
Whenever possible, the Chairman of the Board shall be an Independent Director.

The Board has the discretion to select a Temporary Chairman of the Board who is not an Independent Director to serve while the Board is seeking an Independent Chairman of the Board on an expedited basis.
It is best practice to adopt this proposal soon. However this policy could be phased in when there is a contract renewal for our current CEO or for the next CEO transition.
This proposal topic won 52% support at Boeing and 54% support at Baxter International in 2020. Boeing then adopted this proposal topic in 2020.
KeyCorp is Exhibit A in why the Lead Director role is a poor alternative to an independent Board Chairman.
KeyCorp Lead Director, Mr. Alexander Cutler violates the most important attribute of a Lead Director – independence. As director tenure goes up director independence goes down. Mr. Cutler has 23-years director tenure. Mr. Cutler’s long tenure makes him a prime candidate to retire. It is time for a change given that our stock was at $37 in 2007, relatively early in Mr. Cutler’s tenure.

Mr. Cutler and Mr. Christopher Gorman, KeyCorp Chair and CEO, were the 2 directors who received the most against votes at the 2021 annual meeting.
Mr. Cutler received up to 40-times the against votes of other KeyCorp directors. Plus Mr. Cutler chairs the Governance Committee, in which he is dubiously given the role of resisting shareholder proposals like this proposal that could improve our long-term declining stock price.
With the current CEO serving as Chair this means giving up a substantial check and balance safeguard that can only occur with an independent Board Chairman.
A lead director is no substitute for an independent board chairman. A lead director cannot call a special shareholder meeting and cannot even call a special meeting of the board. A lead director can delegate most of his lead director duties to others and then simply rubber-stamp it. There is no way shareholders can be sure of what goes on.

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