BlackBerry maker Research in Motion is facing tough questions from investors as the company has been forced to scale back its financial outlook, admits that more and more of the smartphones it’s selling are on the low end, and has begun laying off employees. Now, institutional proxy firms that represent blocks of investors in the company are beginning to call for co-CEO’s Mike Lazaridis and Jim Balsillie to give up their roles leading the company’s board of directors. The first firm to make the call was Northwest & Ethical Investments (NEI); today they were joined by proxy advisor Institutional Shareholder Services (ISS). The move is also backed by another advisory firm Glass Lewis.
The proxy firms assert that with Lazaridis and Balsillie serving as both execs and the head of the company boards, there is not enough balance within the company to ensure accountability to shareholders, or that the company’s activities are subject to independent oversight.
Balsillie and Lazaridis are RIM’s largest shareholders, each with more than five percent of the company. A stock options scandal forced Balsillie to leave the board (and the chairmanship) in early 2007; he returned to the board as co-chairman alongside Lazaridis in late 2010.
RIM’s annual shareholder meeting is coming up on July 12. RIM has advised its shareholder to vote against the motion to separate the CEO and chairmanship roles, noting that independent board member John Richardson serves as a de facto head of the board of directors.
RIM shares have fallen roughly 60 percent since February 2011.