As the maker of Blackberry continues to struggle, fast losing smartphone market share to Apple and handset makers that use Google's Android software, a leading investment advisory firm is pushing for the company to overhaul its management and split the dual chairman and chief executive roles now in place.
Glass, Lewis & Co., which advises investors that have more than $15 trillion under management, said Research in Motion Ltd., (RIM), the company that makes the Blackberry smartphone, provides inadequate independent checks at a turbulent time and should support a proposed split in the chairman and CEO roles which are now held by jointly by Jim Balsille and Mike Lazaridis. Glass Lewis & Co. is a proxy firm that advises large institutional investors on voting issues.
A shareholder proxy resolution calling for the change in leadership to gain a more effective checks and balance leadership system is filed with RIM and scheduled for a vote at its July 12 meeting. The advisory firm noted RIM's turbulent start in the first half of fiscal year 2012 and that investor confidence is evaporating. The Blackberry maker has undergone months of controversy and speculation about its future as significant management changes have occurred, with the chief marketing officer and two vice presidents leaving the company.
We are concerned that the current co-chair/co-CEO structure provides inadequate independent checks on executives and management, particularly since the co-CEOs founded the company and are its largest shareholders, the Glass Lewis report states.
The company, of course, has urged shareholders to vote against the proxy, keeping its founders and largest shareholders in the dual leadership role.
Traded on the NASDAQ, RIM's share price has falled near a 52-week low in recent months, some $40 a share off its high of $70.54.