“In addition, the company would join the ranks of biggest companies that are incorporated in Delaware; as a result, the company could have minimal influence over the actions of the state legislature,” ISS said in a report issued before Chesapeake's annual meeting.
Chesapeake rolled out a series of corporate governance proposals Jan. 7 in the wake of a boardroom shake-up last summer that saw CEO Aubrey McClendon relinquish his post as chairman. The company's new board said it would pursue a change in Oklahoma law to allow annual director elections. If that fails, the company plans to reincorporate in Delaware.
Chesapeake spokesman Michael Kehs said the company would not comment on the proposed legislation beyond what it said in regulatory filings.
Bingman's spokesman, Nathan Atkins, said the senator wants to give companies more flexibility.
“Several bills have been filed to modernize our state corporate governance laws by bringing Oklahoma into line with the gold-standard of corporate governance as seen in the state of Delaware,” Atkins said. “The pro tem's intention is to provide businesses with opportunities to determine how best their organizations ought to be run.”
The prior changes to the law caused problems for two other large public companies incorporated in Oklahoma, ONEOK Inc. and OGE Energy Corp. Those companies, which were moving toward annual director elections, successfully sought a legislative change in 2012 to exempt them from the requirement for staggered boards.