Shareholders in Swiss based food company Nestlé S.A. have rejected proposed changes to the company's rules proposed by the Ethos group.

A proposal to preventing the chairman from being a member of the executive board at the same time: was rejected with 50.55% against; 35.94% in favour; 13.51 percent abstentions. There was no vote on reducing board directors' term of office from 5 to 3 years and indi­vidual election of directors since the two-thirds quorum was not reached. A proposal to reducing the nominal value of shares needed to put an item on the agenda was rejected with 74.08% against; 13.72% in favour and 12.20 percent abstentions.

"I want to congratulate shareholders for having made the right decision. The dogmatic approach to corporate governance issues would have meant a long-term competitive disadvantage for Nestlé," said Peter Brabeck-Letmathe, who was elected as chairman and CEO by the board after the general meeting. "I also want to thank shareholders for their confidence in the board's decisions and assure them that we will reflect in a constructive manner on comments and suggestions made by long-term investors during the process of this discussion. The company, which is in the middle of a strategic transformation period, continues to focus its efforts on delivering yet another year of growth and improved performance."

Shareholders elected Professor Günter Blobel, Nobel Prize laureate in Physiology and Medicine in 1999, as a new member of the board for a 4-year term. Rainer E. Gut, chairman of the board, having reached the statutory age limit, did not stand for a new term.

Jean-Pierre Meyers, senior member of the board and vice-chairman of L'Oréal, on behalf of the board as a whole, thanked Gut for his remarkable contribution to the company over 24 years, first as director, then as vice-chairman for 7 years and chairman for a further 5 years.

Immediately after the conclusion of the general meeting, the newly-constituted board of directors of Nestlé S.A. met to elect Peter Brabeck-Letmathe as chairman and CEO. The board also elected Andreas Koopmann as first vice-chairman and Rolf Hänggi as second vice-chair­man.