Shareholder activists won a major triumph Wednesday when Bank of America ( BAC) shareholders stripped CEO Ken Lewis of his chairman title. The Charlotte, N.C.-based banking titan announced late Wednesday that in response to a vote on a shareholder proposal at the firm's annual meeting Wednesday, Lewis would no longer be chairman , but remain in his role as president and CEO. The proposal, which won by a slim margin, was a major priority of labor unions and other dissident shareholder groups, which have pursued similar measures across the financial sector and corporate America. " W e are seeing this issue gain more shareholder support this year, likely spurred by the economic climate and continuing investor concern about board leadership," according to a statement by corporate governance firm RiskMetrics.
According to RiskMetrics, 48 companies received a shareholder proposal seeking an independent chairman, but not all of the proposals will be voted on. Based on tallies so far, the average level of support for splitting chairman and CEO roles stands at 39.2% vs. 29.3% a year earlier, RiskMetrics estimates. RiskMetrics says that based on 2008 data of S&P 500 companies, 34% had a separate CEO and chairman, but only 14% had a board chairman classified as "independent," which is defined as someone who does not have a material connection or significant financial stake in the company. Still, the percentage of companies with independent chairman is larger than in 2007, when only 11% had nonexecutive chairmen. BofA shareholders are angry at the company for the battering its stock price has taken and going though with its acquisition of Merrill Lynch, even after uncovering huge losses late last year. But BofA is certainly not the first financial firm of late to split its chairman-CEO roles.