| BOSTON, April 7
BOSTON, April 7 Influential proxy adviser
Institutional Shareholder Services recommended investors vote to
replace the majority of directors at Wells Fargo & Co in
the wake of the bank's phony-account scandal.
ISS, in a report released on Friday by a spokesman, said
votes against 12 of the bank's 15 directors are warranted after
board committees failed for years "to provide a timely and
sufficient risk oversight process" that could have mitigated the
Wells Fargo reached a $185 million settlement with
regulators in September after it emerged that branch employees
opened as many as 2 million accounts without customers'
permission, to meet sales goals.
Directors ISS recommended votes against included the San
Francisco bank's chairman, Stephen Sanger, although it suggested
investors vote in support of Timothy Sloan, who took over as
chief executive in October.
The report sets the stage for a contentious April 25 annual
meeting for the bank. On Tuesday, proxy adviser Glass Lewis
recommended investors vote against six Wells Fargo
In a statement, Wells Fargo called ISS' voting
recommendations "extreme and unprecedented" and urged
shareholders to make their own judgments about reforms the bank
"The Board has already taken numerous actions and supported
management's steps to promote accountability, strengthen
oversight, and hold to account those responsible for improper
sales practices," Wells Fargo said in its statement.
(Reporting by Ross Kerber; Editing by Dan Grebler)