Goldman Sachs hosted its annual shareholder meeting on May 7, 2010, just ten days after the company's CEO and chairman, Lloyd C. Blankfein, was put on the hot seat by the Senate committee at a hearing to discuss the bank's suspect trading activities and
a fraud suit by the SEC. While the meeting was widely seen as a potential referendum on investor confidence in Blankfein, there were surprisingly few questions about the investigations of Goldman's past mortgage trading or the various lawsuits pending against the Company.
Nevertheless, Goldman shareholders expressed their continued interest in paying a more active role in corporate decision making. Following the 2009 annual meeting, a majority of shareholders requested that the Board take steps to eliminate the supermajority voting provisions from the company's Bylaws and Certificate of Incorporation. In the 2010 annual meeting, the Board itself proposed a resolution to change the supermajority voting provision, which had required an 80% vote, to a majority provision, which requires a vote only above 50%. The proposal received support from an overwhelming 82.5% of outstanding shares and was approved. The passage of this proposal effectively increased shareholder power by decreasing the amount of votes needed to pass proposals at annual meetings.
However, shareholders were much more ambivalent about a proposal to separate the Chairman and CEO roles at Goldman. The proposal emphasized that the "role of the Board of Directors is to provide independent oversight of management and the CEO" and addressed the "potential conflict of interest for a CEO to be his/her own overseer while managing the business." It also referenced a 2009 report by Yale University's Millstein Center for Corporate Governance and Reform that stated, "Having an independent chairman is a means to ensure that the CEO is accountable for managing the company in close alignment with the interests of shareowners, while recognizing that managing the board is a separate and time intensive responsibility." The Goldman board recommended that the resolution be voted "against," and the resolution did, in fact, fail--with support from only 19.1% of the vote. In so voting, Goldman parted company with banks such as Morgan Stanley, Bank of America and Citigroup, which have all split the chairman and CEO roles.