Wells Fargo on Friday took aim at an influential proxy adviser after that firm counseled shareholders to vote against 12 of the megabank’s 15 directors following the phony-accounts scandal.
In a statement, Wells Fargo’s board of directors blasted the recommendation from Institutional Shareholder Services as “extreme,” saying that it failed to take into account the San Francisco company’s ongoing efforts to strengthen oversight and rebuild customer trust.
“The extreme and unprecedented ISS voting recommendation on directors fails to recognize the active engagement of the board and the substantial actions it has already taken to strengthen oversight and increase accountability at all levels of Wells Fargo,” the company said in the statement.
The Wells board also took issue with timing of the recommendation, noting that it was issued in advance of a highly anticipated investigation from the board into the retail sales debacle.
The findings of the investigation, launched in September, will be “made public shortly,” the board said.
Wells in September agreed to pay $190 million to settle charges that more than 5,300 employees created roughly 2 million bogus accounts to meet sales goals. The case quickly snowballed into a reputational crisis, ultimately leading to the resignation of CEO John Stumpf in early October.
The ISS recommendations, issued Friday morning, came days after another proxy advisory firm, Glass Lewis, recommended that Wells shareholders vote against six of the company’s 15 directors.
The Wells board, in its statement, emphasized that it has taken several steps to improve oversight of the company over the past few months.
Included in its list was the promotion of Tim Sloan, a longtime company veteran, to succeed Stumpf as CEO in early October. The company also permanently separated the roles of chairman and CEO. Additionally, it has fired several senior managers in the retail bank and appointed two new members to its board — including former BNY Mellon President Karen Peetz.
Wells is scheduled to hold its annual meeting of shareholders on April 25, in Ponte Vedra Beach, Fla.