The removal of Mary Pugh from Washington Mutual’s board shows that the reforms intended to improve corporate governance and increase shareholder accountability in the U.S. have successfully empowered institutional investors to affect change at companies they own.

News clips highlighting the significance of Pugh’s resignation:

Financial Week: Analysis - Activist shareholders starting to make inroads
“The surprise resignation yesterday of a Washington Mutual director is the latest sign that activist shareholders are actually having some impact on the way companies are run…This renewed focus on board accountability isn’t likely to die out anytime soon. Indeed, corporate boards that have been targeted by activist campaigns should be prepared for a tough fight.”

Financial Times: WaMu Board Director Forced Out
“The resignation of Mary Pugh, who chaired WaMu’s finance committee, represents a big victory for shareholder groups seeking boardroom accountability for the massive mortgage-related losses that have plagued the largest US banks and brokerage houses in recent months…Corporate governance experts said the resignation was a major victory for the union-backed coalition.”

BusinessWeek: Shareholders Score at WaMu
“Is today’s WaMu meeting a tipping point for shareholder success? It’s too early to tell, but WaMu’s succumbing to executive pay criticism, the departure of Mary Pugh, and the high vote on the CEO-Chairman role is indicative of a new era of shareholders’ weight in the often arcane world of corporate governance.”

Portfolio: Activists Claim a Scalp
“Shareholder activists have made a lot of noise but have not been able to point to many changes this proxy season—until today. Mary Pugh, a member of the board of Washington Mutual for nine years, has resigned.”

Forbes: Blood on the Floor at WaMu
“Activist shareholders who were pushing to oust WaMu's finance committee chairwoman, Mary E. Pugh, had something to celebrate. The bank said Pugh had resigned from the board. CtW Investment Group, part of the Change to Win federation of U.S. labor unions, has been leading an effort to hold Pugh and other executives accountable for not seeing the writing on the wall leading up to the mortgage meltdown.”

Posted by Anna Mumford on April 16, 2008 3:09 PM