Magna Provides Additional Voting Information from 2011 Annual Meeting of Shareholders
AURORA - Magna International Inc. released additional voting information from its 2011 annual meeting of shareholders. Although not legally required to be disclosed, a number of Magna's institutional shareholders have requested this additional information concerning the 2011 annual meeting, including through a lawsuit which was filed with the Ontario Superior Court on Monday.
Seven out of the ten directors elected received votes in excess of 84% of the votes cast. Results for the three other directors - Michael Harris , Louis Lataif and Donald Resnick - were impacted by the voting recommendation of a major proxy advisory firm which recommended that its institutional shareholder clients withhold their vote in respect of these three directors. These three directors served on a Special Committee of Magna's Board, which some institutional shareholders questioned for not making a recommendation on the 2010 plan of arrangement (the "Arrangement") that ended Magna's former dual class share structure. Notwithstanding the absence of such a recommendation from the Special Committee, over 75% of Magna's disinterested shareholders approved the Arrangement, following which it was approved by a judge of the Ontario Superior Court of Justice as being fair and in the best interests of shareholders, a decision which was affirmed unanimously on appeal. Market reaction to the Arrangement was overwhelmingly positive and completion of the Arrangement was a significant factor in the 105% increase in the value of Magna's common shares on The New York Stock Exchange in 2010.
Since the completion of the Arrangement, Magna's Board of Directors under the stewardship of Michael Harris , Magna's first independent Board Chair in over 40 years, has adopted a wide range of corporate governance best practices, including:
voluntary adoption of a majority voting policy, effective 2012;
implementation of a Board succession process which resulted in the election of two new independent directors in 2011;
introduction of a mandatory 2/3 Board independence requirement;
implementation of a 75% director attendance standard;
formal separation of Board Chair and Chief Executive Officer roles;
introduction of a limitation on Board interlocks;
an increase in the amount of Magna common shares and share units required to be held by directors from 3 times to 5 times their annual retainer; and
adoption of a formal shareholder engagement policy under which meetings were held with a number of Magna's major shareholders.
Magna's Board continues to evaluate ways to further enhance Magna's system of corporate governance.
In addition to the foregoing governance changes, Magna's Board has also overseen a number of other developments since the announcement of the Arrangement which have been well received by shareholders, including:
reintroduction of Magna's quarterly dividend, followed by three successive quarterly dividend increases in 2010;
a two-for-one stock split;
a normal course issuer bid which resulted in the repurchase of eight million common shares between November 2010 and November 2011 , as well as a further normal course issuer bid commenced in November 2011 to repurchase 12 million shares; and
the streamlining of Magna's executive management team, including through the consolidation of the Chief Executive Officer role in Don Walker .