Trends in Union Corporate Campaigns - US Chamber of Commerce

the balance held by institutional investors. In order to facilitate
acquisitions, the company wanted to expand the number of its
shares. At the same time, the family wanted to retain its influence
over company affairs. So management proposed the establishment
of two classes of stock, one of which, termed a “super voting” class,
would carry ten votes per share rather than the customary one vote.
Most of the super shares would be held by the Marriott family. 11
Sensing an opportunity to demonstrate its clout, HERE began
an effort to line up votes against the dual-stock proposal. To this
end, the union encouraged a small proxy voting advisory firm,
Institutional Shareholder Services (ISS), to advise its clients—
comprising many of the nation’s largest institutional shareholders—
to oppose the change on the grounds that their own influence over
the company would be diluted. With support from the California
Public Employees’ Retirement System (CalPERS) and other
public employee pension funds, the proposal was defeated. 12
This was a signal development in two important ways. First,
it illustrated the selective activation of corporate stakeholder
pressure by a union, not by recruiting allies to support its
organizing, but by developing lines of attack that resonated with
the interests of the stakeholders themselves. In the words of
HERE Research Director Matthew Walker,
People assume that there is a division between labor
and capital. The fact is that we demonstrated an ability to
identify with our fellow shareholders in Marriott and to
build an alliance with shareholders that many people didn’t
think was possible. 13
Second, in a way that has helped prove Mr. Walker’s words prophetic,
it set ISS on a path in support of proxy voting initiatives by labor that
would become highly significant within a very short time.
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Strategy