No Questions Allowed at TDS Annual Meeting: This Year's Governance Posterchild?

Now the bad news. Remember the hubbub a few years back over Home Depot's annual shareholder meeting and the then-CEO Bob Nardelli not allowing questions? Well, it looks like that publicity nightmare was forgotton by Telephone and Data Systems.

Here is what Gary Lutin reports in his "Shareholder Forum":

Yesterday’s annual meeting of TDS shareholders did not provide the expected opportunity for shareholders to consider management responses to their questions. In an unusually restrictive process, the chairman limited business to the formal requirements of presenting matters noticed in the company’s proxy statement and announcing approval or rejection according to the controlling shareholder’s previously reported intentions, followed by a prepared management report of the company’s condition.

The Forum’s four questions for directors were presented at the meeting by a representative of Southeastern Asset Management as part of the legally allowed presentation of their shareholder proposal. The chairman, who had received a copy of the Forum’s questions on May 15, stated that “given other commitments I’ve had, I’m not in a position to speak to the questions the Shareholder Forum raised,” and further that “I also don’t believe it’s the time or place for a director or the chairman to answer those questions.” He did, however, assure a future response.

The chairman subsequently declined to hear other shareholder questions, saying that they could be addressed after the formal part of the meeting. The webcast ended at the conclusion of the formal agenda, though, and it was reported by attendees that shareholders were then simply told that any questions should be sent to the company’s corporate relations officer.

In his report on the meeting, Gary links to the audio archive of the meeting and provides specifics about when the TDS chair blows off the shareholders. Gary also notes that the day job of TDS' non-executive chairman (who is also the brother of the CEO and co-trustee of the family trust that controls TDS through super-voting stock) is a partner of Sidley Austin, heading its Financial and Securities Litigation Group.

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- Broc Romanek