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The director dilemma: a love/hate relationship with shareholders

Joe Mont | May 16, 2017

Yes, this year’s Well Fargo’s annual meeting was chaotic. There was, however, a valuable lesson or two to be learned from what the scandal-weakened bank did right.

We start with the “bad,” as reported by darn near everyone, this publication included. As the meeting convened on April 25, there was little doubt that a contingent of shareholders would be out for blood. The only question was whether they had enough sway to remove directors and impose new managerial demands.

Earlier this year, state and federal regulators announced that Wells Fargo Bank was fined $185 million for creating phony accounts its customers never authorized. Spurred by aggressive cross-selling targets, employees opened more than two million unwanted deposit and credit card accounts.

Needless to say, shareholders were angered by the news. Not only was the scandal bad business for a bank once lauded for its high ethical standards, the fake accounts helped artificially inflate the stock price... To get the full story, subscribe now.