UPDATE: Mondelez International sent Food Dive an update to this story, saying that "ISS recommends that shareholders vote FOR incumbent members of the Audit Committee Mark D. Ketchum, Stephen F. Bollenbach, Jorge S. Mesquita, Fredric G. Reynolds and Patrick T Siewert. All other vote recommendations remain unchanged."
Dive Brief:
- Mondelez said in a filing with U.S. regulators that the company disagrees with a recommendation by the Institutional Shareholder Services, which said that shareholders should vote against five of the company's board members, including the lead director.
- The ISS suggested that shareholders instead vote for the rest of the Mondelez directors.
- Mondelez defended its actions regarding tax-related errors from 2013, which the company did not declare as material weakness upon the discovery of the errors.
Dive Insight:
The ISS fears what this could mean for shareholders. Chicago Tribune quoted ISS, saying that Mondelez's audit committee "failed to provide sufficient oversight over the financial reporting process." Certain risks to shareholders should give them pause, the ISS says, including "the material weakness, ineffective internal control over financial reporting, and the company's need to revise certain financial statements," according to Chicago Tribune.