Glass Lewis opposes lawyer election to SoftBank board for second year
2022.06.15 07:30
FILE PHOTO: SoftBank’s logo is pictured at a news conference in Tokyo, Japan, Feb. 4, 2021. REUTERS/Kim Kyung-Hoon/File Photo
By Sam Nussey
TOKYO (Reuters) – Proxy adviser Glass Lewis has urged SoftBank Group Corp shareholders to oppose the election of corporate lawyer Ken Siegel to the board of directors for a second consecutive year due to his professional ties to the tech conglomerate.
Siegel, who heads the mergers and acquisitions team at the Tokyo office of law firm Morrison & Foerster, has represented SoftBank in deals including the purchase of chip designer Arm and the collapsed sale of the Cambridge-based firm to Nvidia (NASDAQ:NVDA).
“We question the need for the company to engage in legal services with its directors. We view such relationships as creating conflicts for directors,” Glass Lewis said in a proxy paper ahead of the June 24 annual shareholder meeting.
Almost a third of shareholders opposed Siegel’s election last year, in an unusual display of disapproval at an event known for vocal expressions of admiration for Chief Executive Masayoshi Son from attendees.
Son will take the stage at this year’s event on the back foot amid concern over exposure by the conglomerate, whose Vision Fund unit booked a record loss in May, to high growth stocks as interest rates rise and tech valuations fall.
Proxy adviser Institutional Shareholder Services Inc (ISS) recommends election of Siegel, saying while he cannot be seen as independent, “voting against this nominee may run the risk of actually increasing management dominance of the board.”
Son’s dominant role in the company he founded has been brought into relief by the departure of top executives including Chief Operating Officer Marcelo Claure.
Both proxy advisers recommend the election of David Chao, general partner at venture capital firm DCM Ventures, who will become the fifth outside director on the nine person board.
SoftBank has not disclosed the amount of business it does with Chao’s firm, “preventing shareholders from assessing the materiality of the relationship,” ISS said in its proxy paper.
