Gadfly To Trib Co.: End Staggered Board Terms

By: Mark Fitzgerald Self-proclaimed shareholders' rights gadfly Evelyn Y. Davis has been an irritant to management at recent Tribune Co. annual meetings with her frequent questions, and occasional insults. But this year, she's managed to get a formal proposal on the shareholder ballot -- one that directors of the Chicago media giant predictably oppose.

According to the company proxy filed with the U.S. Securities and Exchange Commission, Davis proposes ending the "classified" board with staggered terms for directors that Tribune has had in place since 1974. Davis wants that system, in which only some directors come up for election in any year, with annual elections of all shareholders.

"This insures that ALL directors will be more accountable to ALL shareholders each year and to a certain extent prevents the self-perpetuation of the board," the Davis proposal states.

Many corporate governance advocates oppose the classified board, which they say reduces corporate accountability.

But Tribune directors unanimously recommend a vote against the proposal, according to the proxy for the May 2 annual meeting.

"A classified board is designed to safeguard the corporation against the efforts of a third party intent on quickly taking control of, and not paying fair value for, the business and assets of the corporation," the company states in the proxy.

The three-year staggered terms also "provide stability, enhance mid- and long-term planning and ensure that a majority of Tribune's directors at any given time have prior experience as directors of Tribune," the company said. "This ensures that the Board has solid knowledge of Tribune's business and strategy."

This year, four directors are up for re-election, including Chairman and CEO Dennis J. FitzSimons.

At last year's annual meeting, Davis peppered FitzSimons with repeated questions despite attempts by the meeting's master of ceremonies, WGN-AM radio talk show host Kathy O'Malley, to bring an end to the sometimes rambling interrogation. Davis finally quieted O'Malley by suggesting that she was "jealous" because the activist was "glamorous," something she said the radio host would never be.