UnitedHealth Group Inc. seems to have survived a shareholder revolt. Although they were opposed by shareholders and proxy-research firms, four UnitedHealth directors were re-elected today at the company’s annual meeting, according to published reports.
UnitedHealth had been targeted by disgruntled investors who were upset with its compensation practices, including $1.6 billion in unrealized stock-option gains collected by chief executive William McGuire, noted a Reuters report. McGuire, as well as James Johnson, Douglas Leatherdale, and Mary Mundinger were re-elected by sizable margins. Johnson and Mundinger serve on the board’s compensation committee.
Still sensitive to shareholder concerns, however, UnitedHealth’s board voted to cut back executive compensation and perks and halt the granting of options to McGuire and to Stephen Hemsley, the company’s president, the report said. “With the benefit of hindsight, we perhaps should have moved earlier” to make those changes, McGuire told shareholders, according to Reuters.
Despite shareholder ire, the investors voted down a proposal for directors to be elected by majority vote rather than by a plurality, according to the news service. UnitedHealth also announced that it has renewed its stock repurchase program under which up to 140 million shares of its common stock may be rebought. This is the seventh renewal of the program that was started in November 1997.