Healthways shareholder wants board declassified

A New York pension fund is pushing shareholders of Healthways to vote to declassify the wellness services company's board of directors.

In its recently filed proxy statement [2], Franklin-based Healthways says it opposes the proposal by the New York State Common Retirement Fund — which owns 1.1 percent worth of the company — to break up its three-class board. While the New York fund calls having a declassified board a "powerful tool for management incentive and accountability," company officials say the current setup protects directors from "undue pressure from special interest groups" and protects the company from abusive takeover tactics.

Healthways' declassification vote will be the second such decision this spring for shareholders of a local company. A Kansas City pension fund last month [3] said it wants National HealthCare Corp. to drop its board class system.

Another bit of noteworthy news from the company's proxy was buried in the executive compensation section. James Elrod, who had joined the company as vice president and general counsel early last year, resigned from his position in late February. Elrod, whose pay package topped $820,000 in 2011, came to Healthways [4] from King Pharmaceuticals.

Shares of Healthways (Ticker: HWAY [5]) are essentially unchanged so far in 2012, trailing the broader market by double digits. In Friday morning trading, they were down slightly at $6.86.