[Virginia GASP]  Philip Morris Shareholders' Meeting, 1995

EXCERPTS from The New York Times, April 28, 1995, "Philip Morris Annual Meeting Snubs Protests", by Glenn Collins.
At an often combative annual meeting of the Philip Morris Companies that was a magnet for anti-tobacco activists who tried to transform the proceedings into a cigarette circus, stockholders voted overwhelmingly today to elect  management's slate of 14 directors. The victory trounced a symbolic protest vote that had been spearheaded by some of the company's large institutional shareholders.

In addition, voters rejected by a wide margin six shareholder proposals that had been opposed by Philip Morris management.

It was a showcase for a new, publicly confrontational, Geoffrey C. Bible, who ran his first annual meeting as the company's chairman and chief executive.  Mr. Bible, keeping the two-hour meeting under firm control from the podium, not only used the opportunity to try to reassure investors about legal and regulatory challenges to tobacco, but also inveighed against "plaintiff lawyers looking for clients, and for new ways of lining their purses."

The company produces popular cigarette brands, including Marlboro and Virginia Slims, as well as food and beverage brands including Miller beer, Maxwell House coffee and Post cereal.

An optimistic presentation by Mr. Bible was met with often hostile questions at the meeting, involving inquiries about the potential of risk for tobacco investors. Such concerns have spurred a battle with the pension funds, and are likely to keep doing so.

"We are going to keep close tabs on how the directors will be acting next year," said Anne Hansen, deputy director of the Council of Institutional Investors, a group of 100 pension funds whose assets exceed $800 billion. She called it "gratifying" that nearly a quarter of the shareholders voting had supported a resolution to scrutinize the pensions paid for outside directors.

The council's largest member is the California Public Employees' Retirement System, or Calpers, the nation's biggest public pension fund and the largest institutional shareholder of Philip Morris among the public funds, with $365 million worth of stock.

Its deputy executive director, Richard H. Koppes, led the movement to reject the company's slate of directors as a symbolic protest against Philip Morris's refusal to schedule a meeting between outside directors and institutional shareholders.

But the company's choices for the 14-member board were resoundingly approved by 96 percent of the shareholders voting. "Our purpose was to send a message," Mr. Koppes said in a telephone interview, "and I hope we did."

The tobacco opponents also made much of an impromptu remark by Mr. Bible that "it would be sensible for pregnant women not to smoke."

He made the comment in response to a question from Dr. Lori D. Karan, an assistant professor at the Medical College of Virginia, who asked, "If your wife or daughter was pregnant, would you want her to smoke?"

It was "the first time a tobacco company chief executive has admitted that there is a health problem with one group of smokers," said one of those at the meeting, the Rev. Michael Crosby, coordinator for the Interfaith Center on Corporate Responsibility in Manhattan. "He's opened the door to a Pandora's box of more and more litigation."

Company spokesmen played down Mr. Bible's statement, saying tobacco manufacturers had long said that pregnant women concerned about smoking should consult their doctors.

"For years there has been a warning on cigarette packs that smoking 'may complicate pregnancy,' " said Steven C. Parrish, who was named by the board today as Philip Morris's head of corporate affairs.

News of the statement may have concerned Wall Street, as shares of Philip Morris edged down 12.5 cents to close at $67.625 on the New York Stock Exchange.

The annual meeting was held in a friendly hometown auditorium equipped with soft maroon seats fitted with chrome ashtrays for the numerous smoker-stockholders in the audience. ...

[Virginia GASP]  Added 9 April 2011