Proxy Proposals Make

Management Demands

The Landover-based National Automatic Sprinkler Industry Pension Plan has filed more than 40 proposals this year requiring shareholders of major companies to vote on corporate governance issues, such as requiring independent directors to chair boards of directors and asking companies to count stock options as an expense.

The proxy proposals are part of a shareholder activism program operated by the United Association of Plumbers and Pipefitters International Union, which represents more than 320,000 workers and administers the sprinkler pension fund and about 250 other pension plans.

This is the fifth year of the union's activism program, but it has garnered new strength from a rash of high-profile accounting scandals, spokesman Sean O'Ryan said. The union has offered shareholder proposals calling for independent chairmen at Kohl's Corp., Georgia-Pacific Corp., the Anheuser-Busch Cos., and other companies in which it has significant investments.

"Ten years ago, proposals coming from shareholders were lucky if they got 10 to 15 percent," of shareholders' votes, O'Ryan said. "Today, they can garner a lot of support."

Still, O'Ryan does not expect the union to win many of its proxy fights. In most cases, they are opposed by management. That is the case at Anheuser-Busch, where the sprinkler industry pension plan owns 95,871 shares and is asking other shareholders to require that a director who has never been chief executive of the company serve as chairman.

In a recent Securities and Exchange Commission filing, Anheuser-Busch's board said the company has "ample" independent directors to offer critical review of management plans. At present, the positions of chief executive and chairman are held by two different people. Shareholders there have until April 23 to vote on the Anheuser-Busch proposal.