A Cummins shareholder is proposing that the Indiana-based manufacturer separate its CEO and board chair roles into two different positions as a way of creating more oversight within its leadership structure.
Cummins disclosed the proposal in its annual proxy statement, which the company released Monday morning in advance of its annual shareholders meeting, set to take place virtually on May 10. The proxy identifies the proposal as coming from an individual shareholder, but it does not identify that person.
Currently, Tom Linebarger serves as both CEO and board chair at Cummins. The company’s lead director is Alexis Herman, an independent director who has been on the board since 2001 and plans to retire from the role at the end of the annual meeting.
“With the current CEO serving as chair, this means giving up a substantial check and balance safeguard that can only occur with an independent board chairman,” the proposal says. “The lack of an independent board chairman is an unfortunate way to discourage new outside ideas and an unfortunate way to encourage the CEO to pursue pet projects that would not stand up to effective oversight.”
Columbus-based Cummins has a 13-member board. Linebarger, and President and Chief Operating Officer Jennifer Rumsey, are the only Cummins executives on the board. The other 11 members are independent, meaning that they come from outside of the company.
Click here to read the full story from Susan Orr at the Indianapolis Business Journal.
