The Securities and Exchange Commission has denied the company permission to omit from its proxy a proposal calling for an independent chairman.
Earlier this year, CtW Investment Group filed the proposal calling for the board's chairman to be a director who has not previously served as an executive of the company and is "independent of management." Goldman had claimed that the proposal should be omitted on the grounds that the proposal's language was inherently vague.
The SEC said it was "unable to concur" with Goldman's argument in a letter to the company published Friday.Goldman battled a similar proposal last year from the AFSCME (American Federation of State, County and Municipal Employees). The proposal was later withdrawn after the investment bank agreed to appoint an independent lead director. Calls for the separation of CEO and Chairman roles on Wall Street's biggest banks have been growing. JPMorgan Chase (JPM) CEO and Chairman Jamie Dimon is up against a similar proposal, also filed by the AFSCME. Concerns about Dimon's influence on the board has grown after the $6 billion London "Whale" trading debacle. But Dimon dismissed the proposal at the firm's recent investor day, calling it a "sideshow". Citing an unnamed study, he said that performance at companies actually worsens after the roles are separated. -- Written by Shanthi Bharatwaj in New York.
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