Shareholders of Research In Motion didn’t rise up in revolt at the company’s annual general meeting over the company’s fading performance in the past 12 months.
Instead, in a meeting in Waterloo, Ont., they elected board of directors proposed by management slate that included only one new face.
However, there were signs of disappointment.
During the voting, 30 per cent of the votes were withheld for one director, 22 per cent were withheld for chair Barbara Stymiest and 19 per cent were withheld for founder and former co-CEO Mike Lazaridis. No director had fewer that 14 per cent of the votes withheld.
That led activist shareholder Vic Alboini, chairman and CEO of Jaguar Financial Corp., a Toronto merchant bank that has been highly critical of RIM management, to declare that "this is not an overwhelming approval for each of the directors.” He asked Stymiest if the board will discuss the meaning of the vote with “the shareholders effectively saying no to some of the directors being elected.”
Yes it will, she replied, as part of the board’s deliberations on renewing itself.
Earlier Albonini asked Stymiest if the board is “aggressively” looking for “technology experienced board members, consumer marketing stars, people in Silicon Valley, people in the United states who would bolster this board?”
In reply, Stymiest said the board recognized it had gaps in its experience.
The only time things got heated was when one shareholder said he is “extremely, extraordinarily critical” of the board for letting the company get into financial trouble before doing something. “Why did they let it get out of hand so badly and so much before they did something about it?
None of the “old” members of the board should hold their seats, he said.
He got a round of applause when he said “what this company needs is an upheaval like the CPR (Canadian Pacific Railway),” he said, which last month saw directors resign under shareholder pressure.
Stymiest and CEO Thorsten Heins took pains to make sure shareholders realize management understands their discomfort. RIM shares have been fallen since the fall of 2008 from $140 to $7.50-range today. During that time BlackBerry sales in the U.S. have plunged as well. RIM is behind schedule on releasing the next-generation BlackBerry 10 smart phones that it hopes will boost sales The company has had two quarters of losses, and Heins expects “the next several quarters to be very challenging.”
That has lead Jaguar Financial and others to call for the company to be broken up to maximize shareholder value.