Specialty re/insurer Argo has been urged to remedy its culture of “insularity and management protectionism” by fourth-biggest shareholder Voce Capital Management.
Voce believes Argo will only be able to regain shareholders’ trust through the addition of shareholder representatives to its board.
It was announced earlier this month that five members of Argo’s board were to retire amid an ongoing “refreshment process” seemingly brought about by pressure from shareholder Voce Capital Management and a subpoena issued by The US Securities and Exchange Commission.
Interestingly, the five board members set for retirement were the same originally identified by Voce as “The Big 5”; a centrepiece of what it considered an “over-tenured and controlling board.”
Board members set for retirement include Gary V. Woods, Chairman; F. Sedgwick Browne, Risk & Capital Committee Chair; Hector De Leon, Member of Audit and Human Resources Committees; Mural R. Josephson, Audit Committee Chair; John R. Power, Jr., Human Resources Committee Chair.
Now, Voce says that removing these board members in order to create vacancies to be filled with the Nominees is the best opportunity shareholders will have to elect to representatives that will act in their best interests.
Should the aforementioned board members be allowed to retire at the 2020 Annual Meeting, Voce says the current board will unilaterally select and appoint their replacements.
Therefore, Voce believe voting to remove and replace the Big 5 Directors at the Special Meeting is the only path to ensuring that shareholders have meaningful input into the Board’s composition going forward.
Argo recently criticised Voce’s push to to replace board members, explaining why its board believes the prudent course of action is to continue with its refreshment process and corporate governance changes previously announced and well underway.
