In a letter to independent members of Swift Transportation’s board of directors, the Teamsters union asked the board to appoint an independent chairman of the board who is not also the executive officer of the company.
Jerry Moyes, the company’s chief executive officer, also serves as chairman of the board. The Teamsters’ letter recognizes the independent directors’ recent statement acknowledging the need to stop related party transactions, but maintains that the best way to protect shareholders from abuses of conflict of interest is to separate the chair and CEO positions.
Moyes is under investigation by the Securities & Exchange Commission (SEC) for a questionable stock-buying spree. Days before Swift issued a positive press release announcing better-than-expected second quarter earnings guidance and outlined a $40 million stock buyback—sending Swift’s stock price up 20%—Moyes purchased a large block of stock, saving him an estimated $600,000. He also failed to report to the SEC the May 19, 2004, purchase of an additional 7,000 shares of stock at $15.14 per share. In June 2004, the stock was trading above $18.00.
“The chairman of the board is responsible for oversight of the CEO of a company and to protect shareholders,” said C Thomas Keegel, Teamsters general secretary-treasurer. “It is impossible for Moyes, especially in light of his conflicts of interest and alleged insider trading, to provide the independent oversight so badly needed at Swift.”