Institutional Shareholder Services Inc. released its report on Elaine Wynn’s battle to remain on Wynn Resorts’ board late on Sunday. The 31-page document suggested that shareholders should withhold their votes from both John J. Hagenbuch and J. Edward Virtue, the two renominated incumbent board members, and reject Ms. Wynn’s bid to retain her seat.
According to the proxy advisory firm, Stephen Wynn’s former wife and the other directors should not tolerate weak governance and pay practices and a poor “overall corporate governance profile.”
Back in March, both Mr. Hagenbuch and Mr. Virtue were renominated by the governance committee of Wynn’s board. Furthermore, Ms. Wynn’s seat was eliminated, which resulted in her seeking a proxy effort to retain it.
Ms. Wynn filed a lawsuit against her former husband in 2010, in order to be released from a certain agreement, under which she could not sell stock if that would risk Mr. Wynn’s controlling interest. The two of them currently have 19.3% of Wynn Resorts’ shares.
Assessors from Institutional Shareholder Services blamed board members for failing to determine how Mr. Wynn would be replaced in future.
Furthermore, the proxy firm’s report was believed to be crucial to Ms. Wynn’s future as a director of the gambling operator, as most of the major shareholders are expected to follow its recommendations.
Assessors wrote that Ms. Wynn stated in a way that she should remain a board member for diversity’s sake, as she is the only female shareholder, but she has not achieved much during her 13 years as a Wynn Resorts director.
Late on Sunday, the company released a statement, in which it said it is “pleased” with the report’s recommendations for the rejection of Ms. Wynn. Furthermore, spokesman Michael Weaver said that Wynn Resorts has recently restructured benefits for executives and has implemented a new compensation program, based on executives’ performance. The company also promised to diversity its board.
Ms. Wynn, too, released a statement, saying that she is well-aware Wynn Resort’s shareholders deserve better choices than the ones they are currently presented with. She also pointed that she is their only resort for a change in the current state of affairs.
The shareholders’ final decision is expected to be announced during the operator’s annual meeting, which is scheduled for April 24 and will take place in Las Vegas. It is important to note that Ms. Wynn’s term also expires on that exact date.
