We are pleased that our concerns regarding ISS and Glass Lewis’ recommendations have been publicised by the Economic Daily. Please find the article here.
English Translation
TECO Electric and Machinery (1504) stated on the 17th that two international voting advisory agencies recommended that shareholders vote for the 11 directors appointed by the company. “Future TECO”, which represents the market faction, published an article on the website, FutureTECO, stating that the ISS recommendation was wrong and was shocked by the Glass Lewis revised voting recommendation report.
“Future TECO” calls itself a group of shareholders who care about TECO’s shareholders and is committed to promoting TECO’s strategic modernization and sustainable management vision and nominated eight director candidates at the shareholders’ meeting. “Future TECO” pointed out that in the past three years, TECO’s business focus has shifted to the “intelligent energy” field, including large-scale construction business. However, switching to the construction business is a sub-optimal choice for shareholders, as it is a low-profit and high-risk business.
“Future TECO” pointed out that TECO’s electric vehicle strategy focuses on light commercial vehicles and buses, but the market is significantly smaller than electric vehicles and concentrated in mainland China, while TECO’s presence in this industry is very limited. There has been little real progress in the EV passenger car market.
In addition, “Future TECO” believes that TECO has not fulfilled the financial performance and strategy promised in 2021.
“Future TECO” is led by the non-corporate faction represented by the eldest son of TECO Chairman Ted Huang, Huang Yu-ren chairman of CSI. Chwen-Jy Chiu chairman of TECO, pointed out related operational demands on the 17th that among the non-corporate faction there are also current TECO incumbent directors who can also make suggestions in the board of directors in the past few years, and the management team will refer to them. However, in the past three years, no relevant information or suggestions have been received from the current directors, so there has been no adjustment in the direction pointed out in the report.
Regarding Glass Lewis’s revised recommendation report to support corporate candidates, Future TECO believes that Glass Lewis’s revised voting recommendation report lacks rigor, balance and analytical capabilities.
Glass Lewis’s original report recommended that TECO shareholders vote for the reform camp to nominate six of the eight candidates; however, TECO later reported an error and Glass Lewis revised the recommendation report to support the corporate camp.
“Future TECO” stated that Glass Lewis’s revised recommendations were released one week before the annual general meeting, and two working days before the deadline for voting by non-Taiwan institutional investors. The proposed revisions included unexplained changes to previously published research. The reversal completely damaged the “Future TECO” campaign.