National Legal and Policy Center today presented a proposal that calls for an independent chair of the Board of Directors at Verizon Communications Inc.‘s annual meeting of shareholders. The proposal would require the positions of board chair and CEO to be held by two different individuals.
Hans Vestberg/PHOTO: TechCrunch (CC)
The company’s CEO is Dan Schulman (pictured above), who was recently chosen as the successor to Chairman/CEO Hans Vestberg. Schulman served as a director almost during the entire tenure of Vestberg, with the last year or so serving as Lead Independent Director. While Schulman is not Chairman presently, Verizon has no policy that mandates the roles be divided between different executives.
The company’s board of directors opposed our proposal, as explained on Page 83 of the proxy statement. NLPC responded to the board’s opposition statement in an exempt solicitation report circulated to Verizon’s shareholders.
Presenting the proposal was Paul Chesser, director of NLPC’s Corporate Integrity Project. His three-minute remarks can be heard here, and a transcript follows:
I’m Paul Chesser of National Legal and Policy Center.
Item 6 requests an enduring independent Board Chair policy.
While Verizon currently has an independent Chair, the Board retains discretion to reverse this arrangement at any time.
That’s what enabled previous Chair/CEO Hans Vestberg to hold both titles for most of his tenure—a period when Verizon’s stock consistently underperformed the S&P 500.
Today’s leadership structure exists at the Board’s pleasure, not as permanent policy.
Item 6 would close that loophole.
Why does this matter?
Because the track record of Verizon’s current CEO raises serious concerns about concentrating additional authority in his hands.
Dan Schulman spent nearly a decade running PayPal, where he presided over catastrophic value destruction.
PayPal peaked above $300 dollars per share in 2021, but lost approximately three-quarters of its value before his earlier-than-announced departure amid investor dissatisfaction.
This wasn’t just market turbulence—strategic misjudgments drove that collapse, including aggressive growth targets he was forced to abandon.
Mr. Schulman’s leadership extended beyond financial underperformance to troubling politicization of corporate operations.
He cancelled PayPal’s planned expansion in Charlotte, withholding four hundred jobs as a political protest.
More concerning was PayPal’s customer account closures based on political views that management found disagreeable.
And as a Verizon Director since 2018 and Lead Director through last year, Mr. Schulman is partly responsible for this Board’s oversight failures during Mr. Vestberg’s underperformance period.
In other words, Mr. Vestberg’s record is also Mr. Schulman’s record.
Further, Verizon complied with politicized subpoenas targeting phone records of Members of Congress, while peer AT&T resisted similar demands.
When summoned to testify about this episode, Mr. Schulman failed to appear before the Senate Judiciary Committee.
Avoidance of accountability is not a quality a company wants in its CEO, much less the leader of its Board.
And speaking last month, he acknowledged Verizon has been “ceding market share to competitors” and conceded the company can no longer “coast on claims that it has the best wireless network anymore.”
This is your CEO admitting competitive decline – again, which also happened while he was allegedly exercising oversight on the Board.
The Board asks for “flexibility” to continue making decisions that produced years of market underperformance and governance failures.
Given the record, this Board doesn’t need flexibility.
Instead, it needs more guardrails through an independent chair policy.
We urge shareholders to vote FOR Item 6.
All assertions made by Chesser in his above remarks are footnoted and can be found in NLPC’s exempt solicitation report, here. An executive summary of the report can be viewed here.
Read NLPC’s shareholder proposal for Verizon’s annual meeting here.
Listen to Chesser’s presentation of the proposal at the meeting here.
