CalPERS withholds vote on 5 HP directors

Salin's note: Important story - that will likely not be seen or followed. After the corporate implosions of 2002, Paul Volker took on the charge of heading up the panel to make changes for accounting practices. He quit after several months with public statements that it was clear that the big accounting industry had determined that it needn't change anything regarding the aggressive accounting methods that had evolved in recent years (and contributed to those corporate implosions). It was as if once the press stopped watching closely, and there were no more big corporate implosions before the eyes of the public, then there was no more problem... let's get back to where we were. The real problem, however, is that the aggressive accounting methods, the mixing of 'business consulting' (setting up complex structures that may hide/obscure real financial footing) and auditing procedures by the same firm, etc., make it hard for investors to be able to make sound investment decisions - because the audit reports become meaningless.

The real power - is the ability to vote for the corporate boards based on the policies that they approve. But few individuals or entities have enough stock to hold a block of votes large enough to make any difference. Except, in some cases, very large institutional investors. Like - CalPERS. This is an interesting story - how much bigger impact might be made/felt/written about etc., hard to tell. But it seemed worth posting here at LBN, along with a note to point out the significance of the story.

CalPERS withholds vote on 5 HP directors

FUND ALSO OPPOSES ERNST & YOUNG AS PC MAKER'S AUDITOR

By Dean Takahashi

Mercury News


The California Public Employees' Retirement System has withheld votes from five Hewlett-Packard directors who did not comply with the pension fund's corporate governance policies.

Sacramento-based CalPERS said in a statement that it did not vote for the directors' re-election because they approved non-auditing fees for auditor Ernst & Young.

``We firmly believe that auditors should not be doing consulting type-work,'' said Brad Pacheco, a spokesman for CalPERS, the nation's largest pension fund. ``We've learned from experience with Enron and others that it provides conflicts of interest.''

HP spokeswoman Stacy Katz declined to comment.

CalPERS withheld its 17.9 million shares from directors Lawrence Babbio, Patricia Dunn, George Keyworth, Robert Knowling and Sanford Litvack in advance of HP's March 17 shareholder meeting in Houston. The directors are members of HP's audit committee. The pension fund also voted against renewing Ernst & Young as the computer maker's auditor.

more: http://www.siliconvalley.com/mld/siliconvalley/8149781.htm

As always, thanks for watching out for my pension $$

knows.

its my pension money too, oh don't ya know it!!

:dem: :kick: