In an accompanying letter, Ackman urged shareholders to vote for Pershing's seven nominees to the Canadian Pacific board, and to reject CP management's executive compensation plan.
Pershing, CP's largest shareholder, wants Canadian Pacific to replace Chief Executive Fred Green with former Canadian National Railway CEO Hunter Harrison, pointing at what it says are dismal operating results under Green's leadership.
"For the past six years, the board and Mr. Green have led CP down the wrong track," Ackman wrote. "Since Mr. Green became CEO...CP dropped to dead last in operating performance among Class I North American railroads."
In its circular, Canadian Pacific said it would reintroduce an operating ratio target as one of the performance measures to determine annual and long-term incentive remuneration for executives.
Pershing's filing said that given CP's performance under similar plans in the past, it is clear that the board has either set the wrong goals, or been too lenient in assessing management's performance.
Pershing announced its seventh nominee to the CP board, former Norfolk Southern Corp executive Stephen Tobias. Before the announcement, CP had said that Peshing's slate lacked railroad expertise.
The other nominees are Pershing CEO Ackman and his partner Paul Hilal, management consultant Gary Colter, energy executive Rebecca MacDonald, former Onex Corp executive Anthony Melman and Paul Haggis, former CEO of the Ontario Municipal Employees Retirement System, one of Canada's largest pension funds. (Reuters)
