Shareholders of Community Health Systems, Franklin, Tenn., re-elected all five Community directors who were up for election at the annual shareholders meeting, but three directors who were targeted (PDF) by an adviser to union pension funds received significantly more no votes than the other two, according to a securities filing.
CHS shareholders re-elect five directors
The two outside directors among those targeted—James Ely III and John Fry—received the lowest percentage of votes for their re-election, at 82.9% each. The third targeted director, Larry Cash, executive vice president and chief financial officer, received 90.4%. The other two directors received significantly more votes in favor of re-election: Dr. William Jennings at 99.5% and H. Mitchell Watson Jr. at 98.4%, respectively.
CtW Investment Group, which advises pension funds associated with the unions in the Change to Win coalition, contended that Ely and Fry were negligent in their duties on the audit committee in failing to investigate CtW's allegations last fall that the company's high rate of one-day stays would draw regulatory scrutiny. Cash was targeted for his work as CFO. Institutional Shareholder Services agreed with CtW regarding Ely and Fry and urged its clients to vote no on those two directors as well, but did not urge a vote against Cash.
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