Glass Lewis, an influential shareholder advisory company, has told shareholders of the budget airline to vote against several directors on its board because of concerns over proper governance. Its arguments are more persuasive than Ryanair has let on.
Ryanair Holdings Plc’s chairman of more than two decades, American billionaire David Bonderman, is facing increasing opposition to his re-election at the Irish discount carrier’s annual meeting this month.
The ITF and ETF international labor groups and investor-advisory service Glass Lewis are separately lobbying against the reappointment of Bonderman, a long-time ally of Chief Executive Officer Michael O’Leary who has led the Ryanair board since 1996.
Efforts to displace the founder of private-equity titan TPG Holdings at the Sept. 20 meeting have emerged following a 12-month labor crisis at Ryanair. A scheduling foul up gave staff increased bargaining power, compelling the airline to accept unions and sparking a spate of strikes that have squeezed earnings and seem set to push up costs as it’s forced to renegotiate contracts.
The two labor groups said that Bonderman, 75, has presided over a corporate culture “which for two decades was virulently anti-union,” adding that if Ryanair is serious about engaging with workers and unions, “the time has come for fresh leadership.”
Glass Lewis on Aug. 23 recommended that shareholders unseat the chairman because of the choice of Kyran McLaughlin as senior independent director, when he is also deputy chair of Davy Stockbrokers, a firm that acts as a major adviser to Ryanair. It also opposes the re-election of former Ryanair finance chief Howard Millar as a member of the company’s remuneration committee, saying the body should consist solely of independent directors.
Ryanair last month reached two accords in its efforts to appease staff, securing a deal with its Italian pilots and a preliminary agreement with Irish cockpit crew who spearheaded the original dispute. Negotiations with cabin crew and aviators across the rest of its network are ongoing.
©2018 Bloomberg L.P.
Photo credit: Shown here are passengers boarding a Ryanair flight in Dublin. The airline faces investor protest over the directors it has backed to be on its board. Bloomberg