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File photo of Bombardier Inc. chairman Pierre Beaudoin.

Fred Lum/The Globe and Mail

Canada's largest pension fund has joined a rash of other institutional shareholders hoping to shake up Bombardier Inc.'s board of directors, withholding its vote for executive chairman Pierre Beaudoin in the face of widening public opposition to the company's executive compensation plan.

The decision by Canada Pension Plan Investment Board means the country's major institutional investors are now solidly behind shaking up the family-controlled company – Mr. Beaudoin is part of that family – after the plane maker announced increases to executive pay after receiving cash injections from the federal and Quebec governments.

The manufacturer's annual meeting takes place Thursday. CPPIB joins others including Caisse de dépôt et placement du Québec, Ontario Teachers Pension Plan, Quebec's Solidarity Fund FTQ and British Columbia Investment Management Corp.

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Konrad Yakabuski: No more business as usual at Bombardier

Globe editorial: At Bombardier, pension fund activism takes flight

Read more: Teachers join shareholders seeking governance changes at Bombardier

A spokesman for CPPIB said Wednesday morning that the vote was in line with its proxy voting principles and guidelines – in particular, its belief that board chairs should be independent from management. "The board chair should lead the board and ensure that it acts in the long-term best interests of the company," the pension's guidelines read.

NEI Investments, another Bombardier shareholder, confirmed it is not supporting any incumbent members of the plane maker's board. It opposes Bombardier's a dual class share system and says the company's governance is "problematic, notably in relation to compensation," according to Michelle De Cordova, director of corporate engagement and public policy at NEI.

"We recognize the changes were made to the compensation but it shouldn't have needed a public ruckus for the board to realize there was a problem with the compensation," Ms. De Cordova said. "This is the job we elect them to do and what they get paid for."

NEI held a stake of roughly 4.2 million shares in Bombardier, according to the latest information available.

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Despite the growing investor discontent with the aerospace company, Mr. Beaudoin's family controls Bombardier through a special share class, which gives it 53 per cent of voting power despite holding only a 13-per-cent equity stake. The drop in institutional support therefore does not directly threaten the executive chairman's re-election, though the symbolic rejection could persuade the company to make changes.

In a March circular distributed to shareholders, Bombardier indicated a plan to bump executives' 2016 remuneration by nearly 50 per cent – shortly after receiving more than $1-billion (U.S.) in taxpayer funding and announcing intentions to eliminate more than 14,000 jobs, including nearly 5,000 in Quebec.

The company eventually relented, revising Mr. Beaudoin's pay to 2015 levels and deferring the potential payment of the proposed new compensation.

In a preview of its voting intentions on its website, CPPIB said it would vote against the management's recommended advisory vote on its executive compensation approach, and would also withhold votes for directors Vikram Pandit and Patrick Pichette. The two directors were singled out for "poor attendance" by shareholder advisory firm Institutional Shareholder Services in an April 28 report, showing up for less than 75 per cent of their respective Bombardier board and key committee meetings scheduled during the most recent fiscal year.

CPPIB indicated it would still support the re-election of chief executive Alain Bellemaire to the board, as have the other institutions who have revealed their voting intentions.

Jim Leech, the former CEO of Ontario Teachers, said on Twitter: "It is unconscionable that the Beaudoin family would take any $ (salary, fees or dividends) out of Bombardier before taxpayers are reimbursed."

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Observers have suggested the family should use this opportunity to consider the public's shaken confidence in the company.

In an e-mail, a Bombardier spokesperson declined to comment on the growing number of institutional investors voting against Mr. Beaudoin's re-election, except to confirm that director elections and the company's executive-compensation approach are on the agenda for the Thursday meeting.

In Quebec City, meanwhile, Premier Philippe Couillard said his government would not interfere in a matter that is for investors to resolve. "This debate needs to be one between shareholders and the company," he told the legislature. "I'm sure it will be a vigorous one and we will follow it."

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