Glass Lewis has today emerged as the latest weighty voice to advise London Stock Exchange (LSE) shareholders against dismissing the bourse's chairman, opposing activist hedge fund The Children's Investment Fund Management (TCI) in an increasingly public spat.
The US-based shareholder advisory firm said that ousting Donald Brydon now would "destabilise" the search for a new chief executive. The LSE's former boss Xavier Rolet stepped down last month, amid a campaign from TCI to reinstate him and instead eject Brydon who it blamed for his departure.
Glass Lewis, following the lead of ISS yesterday, added that TCI "failed to present a sufficiently compelling case" to warrant the removal of Brydon, and said it would be in shareholders' best interests to keep him on as chairman until his agreed departure date next year.
"TCI is seeking to remove one incumbent director from the LSE board, Mr Brydon, but has not nominated any alternative director candidates," said a Glass Lewis note seen by City A.M.
"The removal of Mr Brydon at this juncture would do nothing to advance the dissident’s initial objective of reinstating Xavier Rolet as CEO of the company."
Glass Lewis added that it recognised TCI's claim that Rolet had performed well, but that it generally believed decisions regarding a company's management "are best left to the judgement of management and the board".
The firm talked down TCI's claim that shareholders had lost faith in Brydon, and that it would be difficult for the bourse to attract a new boss.
An escalating row
TCI, headed by Sir Christopher Hohn, had its suspicions aroused regarding the London Stock Exchange when Rolet unexpectedly announced in October that he would be vacating his role "at the request of the board".
The activist hedge fund said it had no explanation from the LSE's board as to why Rolet was leaving, and alleged that Brydon had a history of ejecting perfectly successful chief executives.
But Glass Lewis today noted that there was no reason to assume Brydon had taken the decision single-handedly, as the non-executive directors were all in agreement on the succession plan which dismissed Rolet.