Advisory firm says nix to Elaine Wynn, Wynn Resorts nominees

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Posted: Apr 06, 2015 9:08 PM

LAS VEGAS (AP) — An advisory firm has recommended shareholders show their dissatisfaction with the state of affairs at Wynn Resorts in an upcoming election of board members.

Elaine Wynn, who co-founded the casino operator with her ex-husband, company CEO Steve Wynn, is in a battle for re-election to the board. The company, meanwhile, re-nominated two other candidates and not Elaine Wynn.

Institutional Shareholder Services is advising against supporting either option.

The proxy advisory firm said it has "significant concerns" with Wynn Resorts' executive compensation plan. It said the company had set a low bar for performance goals, almost guaranteeing executives would earn their full bonuses. Steve Wynn's pay grew considerably despite negative shareholder returns, it added.

In a report issued Sunday, ISS urged shareholders not vote for Elaine Wynn and withhold their votes to re-elect the two nominees, John J. Hagenbuch and J. Edward Virtue.

"Shareholders may be best served by voicing their dissatisfaction with the status quo — and all nominees' complicity in it," by withholding their votes for Hagenbuch and Virtue, according to the report. The company is due to hold its annual shareholder meeting on April 24.

ISS gave Las Vegas-based Wynn Resorts its lowest scores available for compensation practices and governance and argued that its directors, including Elaine Wynn, haven't made an effort to fix problems.

"There appears to be no daylight between Elaine Wynn and the rest of the board on tolerating weak governance practices, poor pay practices, or an overall corporate governance profile that ranks among the worst, not the best of U.S. companies," ISS said.

In an open letter to Wynn Resorts stockholders Monday, Elaine Wynn said that she is an asset to the board with "unmatched" experience.

Wynn Resorts spokesman Michael Weaver noted the board's implementation of a new performance-based compensation program, changes to executive benefits and efforts to increase board diversity.

Wynn Resorts Ltd. operates casino resorts in Las Vegas and Macau and is building a casino near Boston. Shares of the company rose $1.32, or 1 percent, to close at $130.72 Monday.

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AP writer Joseph Pisani in New York contributed to this report.