Qwest on defensive at meeting
Shareholders and retirees grill the board of directors and
executives, but CEO Ed Mueller takes it in stride.
By Kimberly S. Johnson
Friday, May 23, 2008
Shareholders and retirees ripped into Qwest's executives and
board of directors during their annual meeting Thursday, asking
for better leadership and accountability.
It was the first annual meeting for chairman and CEO Ed Mueller,
who was bombarded with questions from retirees seeking better
benefits and shareholders looking to pare down executive
compensation. More than 100 people attended.
"(It went) fine," Mueller said after the meeting at the Denver
Performing Arts Complex. "The shareholders have a right to
express themselves. I don't think I was surprised about
Executive compensation challenged
The company's stock closed at $4.55 Thursday, down more than 1.5
percent. That is lower than the roughly $5 it was trading
at when former CEO Joe Nacchio was ousted in 2002.
And shareholders wanted answers, particularly in light of
soaring compensation for CEOs nationwide.
One thorny issue: the $1.2 million Mueller made when Qwest
bought his California home.
The company ended up taking a $1.8 million loss on the property.
Mueller was the only one to respond to pointed questions about
the board's oversight of executive compensation and decreasing
Two long-standing members of the board, Linda Alvarado and Frank
Popoff, were repeatedly referred to when shareholders asked how
Qwest will change.
"To what do these people owe their tenure?" asked Gerald
Armstrong, a shareholder advocate in
"We have an excellent board of directors that represent the
shareholders really well," Mueller responded. "These
people do good work for you. These people are dedicated."
A shareholder proposal by Armstrong that would have separated
the roles of chairman and CEO was rejected, with 83 percent of
shareholders voting against it.
Retirees leave satisfied
Retirees said Mueller's response to their concerns was much
better than that of his predecessors, Dick Notebaert and Nacchio.
They said a shift from trying to hold the CEO fully accountable
for the company's failings to focusing on the board was more
"He listened and agreed to sit down and talk to us," said Nelson
Phelps, executive director of the Association of US West
Retirees. "We were able to get our issues out. It
was the most successful meeting we've had since Qwest was
The group was successful in passing its proposal requesting that
the board seek shareholder approval of future severance
agreements of senior executives that would be more than 2.99
times the sum of an executives's base salary plus targeted
Kimberly S. Johnson: 303-954-1088 or