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ISS calls for Guess shareholders to withhold votes on Paul and Maurice Marciano

By Rachel Douglass

Apr 15, 2022

Business

Image: Guess

Proxy advisory firm Institutional Shareholder Services (ISS) has recommended that shareholders of Guess should withhold their votes that could see Paul and Maurice Marciano reelected to the company’s board of directors.

The announcement was made alongside Guess’ activist shareholder Legion Partners Asset. The investment firm has held firm with its ongoing pursuit of a withhold campaign, which is pursuing the goal of removing Paul Marciano from the board following a string of sexual harrassment allegations against the co-founder.

In a report, ISS commented on the Guess board’s “failure to adequately respond to the numerous allegations of sexual harrassment” against the Marciano brother, which date as far back as 1994.

ISS added: “There is a credible risk to the Guess brand posed by Paul Marciano’s continued involvement with the company, and the board has been unable to separate him from the company despite a growing chorus of public allegations of sexual misconduct.”

As Legion Partners progresses with its commentary, the shareholder has faced intense scrutiny from the Guess board of directors, which called its campaign “irresponsible”.

Now, Guess, which is currently undergoing a transformation strategy, has also responded to the ISS, stating that it believes the organisation has come to the “wrong conclusion” and was “disappointed” to learn of the recommendation.

In its response, it said: “Paul Marciano’s leadership and creative contributions have been critical in the establishment of our iconic brand image and execution of new initiatives that enhance the inherent value of Guess.”

The company concluded: “We continue to strongly believe that Legion Partners’ proposed changes to the board and management could risk the company’s transformation and growth and could jeopardise the long-term value of the company.”

Guess is continuing to conduct an investigation related to Legion Partners’ original demand.

GUESS