Updated from 1:29 p.m. EST

Over the objection of management, PeopleSoft ( PSFT) shareholders voted Thursday to expense stock options.

The vote at the software company's annual meeting follows the lead of another major technology company -- Hewlett-Packard ( HPQ) -- whose shareholders voted to expense options earlier this month.

The shareholder vote was advisory, and the company said that the board of directors will consider it carefully.

In a victory for management, however, PeopleSoft shareholders voted overwhelmingly to re-elect the sitting board, despite a plea by corporate governance advocates to withhold their votes. The management slate was not opposed.

The proposal to expense options was made by the AFSCME Employee Pension Plan and the Connecticut Retirement Plan and was supported by Glass Lewis, a proxy advisory service.

Glass Lewis characterized options as an important component of executive compensation that should be reflected in operational earnings. In the proxy, the board cited often-repeated arguments against expensing options, including the difficulty in calculating the cost and a negative effect on retaining employees.

The debate is to some extent symbolic, since the Financial Accounting Standards Board is expected to begin requiring companies to expense options on their income statements starting in 2005.

The meeting was quick and otherwise uneventful. The major issue -- Oracle's ( ORCL) tender offer for the company -- was withdrawn from the agenda at Oracle's request.

PeopleSoft's shares were recently up 46 cents, or 2.6%, to $18.28.

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