German businessman Gerhard Cromme was re-elected as chairman of the supervisory board of Siemens at the company’s annual shareholder meeting yesterday amid criticism from proxy advisory firm Glass Lewis linked to his performance at German steel maker ThyssenKrupp, where he serves as chairman.
Ninety-one percent of shareholders at the meeting voted to give Cromme another five years as chairman of the supervisory board of Germany’s most prominent industrial group despite the recommendations from Glass Lewis that he be rejected on the basis of allegations of price-fixing at ThyssenKrupp and allegations of bribery and poor performance at Siemens.
Glass Lewis advised Siemens shareholders to reject Cromme and opposed his reappointment as chairman of ThyssenKrupp at an annual shareholder meeting last Friday. At the meeting, Cromme faced criticism linked to a series of loss-making international investments and allegations of price-fixing. A third of ThyssenKrupp shareholders voted against Cromme’s reappointment at that meeting, according to a report by Dow Jones Newswires.
‘We believe shareholders would be better protected by the election of individuals who are neither associated with the company’s bribery scandal nor ongoing legal concerns and oversight failures at other companies,’ Glass Lewis said, as cited by Dow Jones.
A counter-proposal to Cromme’s reappointment at Siemens on the agenda for yesterday’s shareholder meeting also cited ‘serious doubts as to whether Gerhard Cromme has adequately fulfilled his obligations as chairman of the supervisory board of Siemens due to his numerous supervisory board posts at other companies. In particular, Cromme’s activity as the chairman of the supervisory board of ThyssenKrupp must be regarded critically.’
German shareholder advisory group Deutsche Schutzvereinigung fuer Wertpapierbesitz did not join Glass Lewis’ call to vote against Cromme’s reappointment at Siemens, instead arguing that shareholders should base their vote solely on his performance at Siemens, and not link it to ThyssenKrupp or publishing company Axel Springer, where he also serves on the board.
In 2008 Siemens paid a total of more than $3 bn in fines in the US and Germany amid an investigation that the company paid bribes in several companies to gain new business. Cromme wasn’t specifically accused in the investigations but he did serve as chairman of the supervisory board throughout the period covered by the probes.
