Tri-CRI Urges Wells Fargo Shareholders to Support Business Standards Review Resolution
The Sisters of St. Francis of Philadelphia and sixteen co-filers, including members of the Tri-State Coalition, filed a shareholder resolution urging Wells Fargo to conduct a Business Standards Review in response to the consumer fraud scandal as the company continues to face serious regulatory, business, legal, reputational and human capital risks. Unethical business practices, the insular company culture, and lack of board oversight all contributed to the magnitude of the fraudulent activity.
The filers composed an Exempt Solicitation detailing why a vote FOR the resolution is warranted. Despite efforts to encourage Wells Fargo executives to support the resolution as a sign to shareholders that the company is serious about making meaningful changes, management ultimately recommended a vote against the resolution. The company has taken several steps, including issuing a 110-page report with the findings of its investigation to determine the root causes of the business practices that contributed to the fraudulent activity. The report exposed troubling practices and culture that enabled risk taking behavior at costumers’ expense. While this review and report is an important step, it does not fulfill the request of the resolution. Investors are still seeking analysis and action plans on the steps the company will take to reduce the risk of future scandals and to transform its systems and protocols to enhance the culture.
The Wells Fargo AGM takes place on April 25, 2017 and the resolution is listed as voting item 5 on the proxy as “Retail Banking Sales Practices Report”. Tri-CRI encourages Wells Fargo shareholders to vote FOR this proposal.
Press about the resolution:
04/19/17 (CNN): Feds knew of 700 Wells Fargo whistleblower cases in 2010
04/1617 (Common Dreams): Nuns Take On Wells Fargo
04/04/17 (Charlotte Observer): Advisory firm urges Wells Fargo shareholders to oppose 6 board members
03/15/17 (LA Times): Wells Fargo shareholders call for a new, broader probe into the bank’s accounts scandal
10/10/16 (Business Journals): Nuns, other religious investors demand Wells Fargo disclose more about fake accounts scandal