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Twitter gives investors the snub they deserve

Twitter’s shareholders and its board are made for each other. The social media platform has refused to accept the resignation of director Egon Durban, who failed to get a majority of votes cast at Twitter’s annual meeting on Wednesday. The company says Durban, the co-CEO of private equity firm Silver Lake, was being punished by some institutional shareholders for serving on six other company’s boards. So now he has agreed to serve on just five.

Will shareholders be angry at this snub? They don’t have much right to be. While he was opposed by a majority at the meeting, only holders of a third of Twitter’s outstanding shares actively voted against him. Exclude the “broker non-vote” segment that reflects shares held by financial firms where ultimate holders hadn’t expressed a view, and the numbers cast against Durban rises to 42%– hardly a majority.

Maybe the rest thought he’s worth keeping. Durban is, after all, close to Tesla boss Elon Musk, who has offered to buy Twitter for $44 billion. Or maybe they don’t care about good governance anyway. Twitter has a so-called staggered board, where only a couple of directors come up for re-election each year. Shareholders had the chance to change that this year, but not enough supported the plan. By ignoring the popular vote, Twitter is just following the spirit of the age. Reuters

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