Vote • Similar pitch for outside monitoring of Utah banking company's top exec was rejected in 2010.
This is an archived article that was published on sltrib.com in 2013, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
Zions Bancorp shareholders will vote on a proposal to establish an independent chairman of the board, during the regional banking company's annual meeting in Salt Lake City on May 24.
The proposal by shareholder advocate Gerald Armstrong is identical to one he presented at Zions' gathering in 2010 and last month at Wells Fargo's annual meeting in Salt Lake City.
Zions and Wells Fargo shareholders rejected the proposals. Armstrong had more luck at KeyCorp's annual meeting last year, where those attending voted to approve his plan to set up a chairman who isn't an executive of the bank.
As it did three years ago, Zions' board of directors is recommending that shareholders attending this year's event at the the Zions Bank building at South Temple and Main rebuff Armstrong's latest proposition, according to the company's proxy statement. The meeting begins at 1 p.m.
Harris Simmons has been CEO and president of Zions since 1990 and chairman since 2002. Armstrong, who owns 901 shares of the company's stock, believes that Harris' performance as the company's top executive should be monitored by an outside chairman.
"The proponent believes that greater accountability is beneficial to good business practices and could have prevented the 2008 problems, which caused earnings to slide and dividends to be reduced to just a penny a share per quarter," Armstrong wrote in his proposal.
Countering his argument, the board said the measure would restrict its ability to select the director most qualified to serve as chairman, and the use of criteria it thinks are in the best interests of the company and shareholders. Zions management already receives "substantial oversight" from the board as it is structured, the statement said.
Simmons and Doyle Arnold, vice chairman and chief financial officer, did not receive bonuses last year. The company, which operates banks in 10 western states, has not given bonuses to its top executives for several years because of the losses Zions endured during and shortly after the recession.
Even so, the total compensation primarily salary and stock awards of Simmons and Arnold jumped. Simmons' compensation rose 64 percent,to $2.5 million last year, largely because he received stock awards worth $664,993. Simmons did not receive any stock awards in 2011.
Arnold's compensation went up 69 percent. Like Simmons, he received stock awards last year, unlike in 2011. The value of Arnold's awards was $501,498. His total compensation came to $1.7 million in 2012.