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Not unlike political candidates, the board of Furniture Brands International Inc. and a dissident shareholder are trying to line up endorsements from outside observers. At stake: seats on the board and, by extension, influence over the direction of the company.

Furniture Brands, the Clayton-based parent company of Lane, Thomasville and Broyhill, announced that Proxy Governance Inc., a proxy voting advisory company, is supporting the company’s full slate of directors. Proxy Governance also recommended that stockholders take no action with regard to three nominees put forward by SCSF Equities LLC, an affiliate of Sun Capital Partner of Boca Raton, Fla.

Sun Capital, Furniture Brands’ No. 2 shareholder, is pushing for three seats on the company’s board. The $10 billion private investment group has publicly criticized the current board, accusing it of not being aggressive enough in pursuing a turnaround and giving short shrift to two buyout proposals. Earlier this week, Sun touted an endorsement from RiskMetrics Group-ISS Governance Services, a shareholder advisory group, which said Sun’s nominees would bring needed expertise to the company.

But Furniture Brands came back with its own supporter, Proxy Governance Inc.
In an opinion on the proxy contest, Proxy Governance said the Furniture Brands board has "taken appropriate action" to unleash the company’s unrealized potential, and deserved latitude to pursue the company’s plan to cut costs and boost sales easy fast cash.

"Our board and management team are pleased that Proxy Governance has recognized our core messages to stockholders — great change has been accomplished and the strategic plan is generating positive results," said Ralph Scozzafava, Furniture Brands’ chief executive, in a statement late Tuesday.

Sun Capital responded Wednesday, announcing it had support from proxy adviser Glass Lewis & Co. However, the support wasn’t complete.

Glass Lewis recommended that shareholders vote for two of the three candidates nominated by Sun Capital, adding they should withhold votes for the third candidate, Ira Kaplan.

Glass Lewis wouldn’t recommend Kaplan because of his governance track record while working as chief financial officer at Claire Stores.

Kaplan sat on Claire’s board while CFO, an executive position that should report to, not serve on, the board, the advisory firm said.

While a board member, he held a 5 percent ownership stake in Roland Schaefer & Associates, which had a business relationship with Claire. That created a potential conflict of interest, Glass Lewis said.

Both these situations led Glass Lewis to question Kaplan’s judgment as board member.

jmcwilliams@post-dispatch.com

314-340-8372

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