Wells Fargo & Co executives planned to convey a message of atonement to shareholders at the bank’s annual meeting in Des Moines, Iowa on Tuesday as it works to convince investors and regulators a sweeping sales scandal is a thing of the past.
The event comes days after Wells Fargo said it would pay regulators $1 billion over mortgage and auto lending abuses, adding to issues prompting calls for more shake-ups at the third-largest U.S. bank.
“Our top priority remains rebuilding the trust of our shareholders, customers, team members, communities, and regulators,” Chief Executive Tim Sloan wrote in a letter introducing the bank’s proxy statement.
The letter was also signed by Elizabeth Duke, a former Federal Reserve governor named chair of Wells Fargo’s board last year in a broader overhaul.
The bank has already agreed to publish a business standards review, prompting shareholders led by the Sisters of St. Francis of Philadelphia to withdraw a shareholder resolution that demanded details on the cultural and ethical causes of recent scandals.
In 2016 the bank admitted employees had opened potentially millions of sham accounts, triggering a leadership revamp. Regulatory issues have persisted, with the Fed in February capping its growth until governance and controls improve.
There are some signs investors will show patience on Tuesday. Proxy advisers Institutional Shareholder Services (ISS) and Glass Lewis recommended investors cast non-binding votes in favor of the pay of executives including Sloan, who received a package worth $17.6 million last year. Both advisers also backed Sloan and nearly all other candidates standing for 12 seats on the board, including eight new independent directors since 2015.
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The only exception was Glass Lewis’ recommended vote against John Baker, a director since 2009. ISS termed its recommendations for certain incumbent nominees “cautionary support.”
Wells Fargo will hear from critics as well in Des Moines. California State Treasurer John Chiang on Monday reiterated his call for the departure of Sloan and said Baker should be replaced if he could not answer for the bank’s lapses.
A spokesman for New York State Comptroller Thomas DiNapoli, who oversees retirement funds, said the system voted against Sloan, Duke and four other directors, and against the pay of top executives. DiNapoli has also sponsored a shareholder resolution calling for a report on the risks pay incentives pose to the bank. The fund has about 14 million shares of the bank, less than a third of one percent of shares outstanding.
Internally, Sloan’s pay has also drawn criticism from some company employees ahead of the shareholder meeting.
The No. 3 U.S. lender by assets has announced plans to grant about 50 shares of stock to most of its roughly 265,000 employees over two years, in theory giving them more of a voice on bank decisions.
A spokeswoman said the award level “was deemed meaningful as we hope our team members will feel a sense of ownership in the progress we need to make, together.”
Wells Fargo is based in San Francisco but has staged annual meetings elsewhere in recent years, including in Florida, Arizona and St. Louis. Its home mortgage and home equity businesses are based in Des Moines and it has about 14,500 workers in and around the city.