ISS recommends against six Keisei Electric Railway candidates in fight with Palliser
ISS's recommendation, which helps guide asset managers' votes on hot button issues, extends support to UK activist Palliser Capital which has been pushing the railway operator for years to reallocate capital and improve governance to boost its share price.
The annual meeting date for Keisei, which runs one of the main lines from Narita airport into the center of Tokyo, is scheduled for June 27.
Palliser "has made a compelling case that a governance overhaul at Keisei is necessary to restore trust in management," ISS wrote in a report seen by Reuters. The hedge fund has argued that the number of insiders on the company's board have led to a lack of accountability for its underperformance.
Now, Palliser wants to block the election of six people and cut the board's size to nine from 15 members, potentially making the board more agile. It is opposing the re-election of four incumbent nominees, including Keisei's president and chief executive officer Toshiya Kobayashi, and two new insiders. Palliser is not targeting Takao Amano who is scheduled take over as CEO from Kobayashi when he transitions to board chair after this year's annual meeting.
Earlier in the week, Glass Lewis, another prominent proxy advisory firm, recommended that investors vote against two directors, including Kobayashi, according to a report seen by Reuters.
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