(Adds comment from Wells Fargo, Illinois official)
By Ross Kerber
Nov 29 Investors, including the state treasurers
of Connecticut and Illinois, called on Wells Fargo & Co
to require an independent board chair, saying the bank needs
stronger oversight in the wake of a scandal over fake customer
Although Wells Fargo already has shuffled its leadership
structure, Connecticut Treasurer Denise Nappier on Tuesday said
the investor group has filed a shareholder resolution for the
San Francisco bank's annual meeting next spring seeking a change
in its bylaws.
Improvements need to be formalized, she said, because a
board whose chair is also chief executive - the dual role once
held by John Stumpf at Wells Fargo - creates a potential
conflict of interest.
"At the end of the day, the company's shameful conduct was
fueled by poor governance that fostered a culture of
irresponsibility and deficiencies in risk management," Nappier
said in a statement.
Via email, Wells Fargo spokesman Ancel Martinez said, "We
appreciate the feedback that we receive from our investors and
we will review the proposal."
Stumpf resigned on Oct. 12, bowing to pressure following a
$190 million settlement the bank reached with regulators in
September. Reviews found the bank's staff opened as many as 2
million accounts without customers' knowledge to meet internal
Stumpf was replaced as CEO by the bank's president, Tim
Sloan. The role of board chair was given to Stephen Sanger, who
had been Wells Fargo's lead director and was listed as
independent in the bank's latest proxy filing.
Nappier called the splitting of the roles "a welcome first
step" but said Wells Fargo must still put a better leadership
structure in place.
Co-filers of the resolution included Illinois State
Treasurer Michael Frerichs, shareholder adviser Hermes EOS and
Needmor Fund, which had filed before Stumpf's
In a separate news release on Tuesday, Frerichs said the
bank's "predatory and illegal banking practices have proved that
the company needs a set of independent eyes to ensure stronger,
Frerichs had earlier cut some state business with Wells
Fargo, such as suspending its use as a broker dealer.
(Reporting by Ross Kerber in Boston; additional reporting by
Jonathan Stempel in New York; Editing by Dan Grebler and