UNITED STATES - The California Public Employees' Retirement System (CalPERS) is trying for the second time to force Hospitality Properties Trust (HPT) to introduce annual board elections.
The pension fund attempted to get the specialist hotel real estate investment trust (REIT) to adopt the practice last year when it proposed a non-binding resolution at the annual shareholder meeting, but only 90% of shareholders voted in favour.
Shareholders will be able to vote again on a similar proposal at this year's annual meeting on 11 May, which would bring an end to HPT's trustees serving in staggered three-year terms.
Anne Simpson, senior portfolio manager and head of corporate governance at CalPERS, said: "The ability to hold corporate boards accountable is limited when directors stand for election once every three years.
"Annual elections will help promote the alignment of interest between shareowners and their elected representatives."
Simpson said in a CalPERS shareowner alert letter that, under the current structure, shareowners will be unable to vote on director William Lamkin until the 2013 annual general meeting.
In 2010, he received only 52% of votes cast as the only one of five HPT directors to stand for election.
CalPERS owned approximately 1.3m HPT common stock shares on the 18 February record date.
CalPERS said that, as of 31 March, HPT underperformed industry peers by 51 percentage points over five years.
The Newton, Massachusetts-based REIT buys, owns and leases hotels and travel centres in the US.
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