EBay Holders Back Proposal on Directors

EBay Inc. shareholders approved a measure Friday that will give them more power to nominate directors of the e-commerce giant.

The proposal, which passed with 59% of shares voted at eBay's annual shareholder meeting, will allow certain investors to nominate board members, who are typically nominated by the company itself. Investors holding at least 3% of eBay's shares for three years will be able to nominate as many as one-quarter of the company's directors.

Similar measures have been approved in recent years at companies including Hewlett-Packard Co. and Verizon Communications Inc. This year, more than a dozen big U.S. companies, including General Electric Co. and Bank of America Corp., have agreed to support letting shareholders nominate their own directors.

EBay had opposed the proposal, which was put forth by New York state's comptroller, an investor in the company through several funds.

"EBay values our stakeholders' opinion and intends to engage with stockholders to develop and implement an appropriate eBay-specific version of proxy access," a spokeswoman said.

A representative of the comptroller's office couldn't be reached.

Proponents of so-called proxy access say it makes corporations more accountable to shareholders who can potentially shake up a board if dissatisfied with a company's strategic direction or annual returns. Institutional Shareholder Services, which advises institutional shareholders on such votes, says it now generally favors proposals like the one at eBay.

Additionally at the meeting, shareholders elected all 15 directors nominated by eBay, including Jonathan Christodoro, an associate of investor Carl Icahn.

EBay plans to spin off payments unit PayPalin this year's third quarter, to create two publicly traded companies. The plan was prompted in part by pressure from Mr. Icahn, who argued that the company was worth more as two separate entities. The independent PayPal won't immediately have a proxy-access policy.

Write to Greg Bensinger at [e-mail]

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