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Yesterday, The Children's Investment Fund Management L.L.P. (TCI) and 3G Capital Partners, Ltd. announced independent proxy voting advisor RiskMetrics Group - ISS Governance Services has recommended that CSX Corp. shareholders elect four of five directors nominated to the Class I's board by TCI and 3G.

RiskMetrics urges shareholders to elect Alex Behring, Christopher Hohn, Gil Lamphere and Tim O'Toole. Behring is 3G's managing director; Hohn is TCI's founder; Lamphere is managing director of Lamphere Capital Management; and O'Toole is managing director of the London Underground. TCI and 3G also nominated Northwest Airlines Co-Chairman Gary Wilson to the board. Results of the board elections will be announced at CSX's annual shareholders meeting on June 25.

"Based on the company's lagging operational performance and the troubling corporate governance implications of the company's aggressive proxy fight defense, and the dissident nominees' track record, skill sets and experience (as well as the numerous additional factors detailed at length herein), on balance we recommend that CSX shareholders support [the] four dissident nominees," RiskMetrics officials said in their analysis released by TCI and 3G.

Each of the four nominated directors is committed to working with other CSX board members and management to effect positive change at the Class I, TCI and 3G officials said in a prepared statement.

"We are very pleased that ISS has recognized the need to strengthen the CSX board and recommended that shareholders elect our superior candidates," they said. "As shareholders with an approximately $5 billion investment, we remain concerned that CSX will not reach its full potential to create shareholder value unless all five of our highly qualified director nominees, with their significant railroad experience, are added to the CSX board to hold management accountable for its performance."

However, RiskMetrics has "inexplicably" chosen to second-guess the U.S. District for the Southern District of New York, which recently found that TCI and 3G principals "testified falsely in many respects" and violated federal securities laws in connection with a swap transaction, CSX officials said in a statement.

"RiskMetrics has substituted its own uninformed judgment for the court's conclusions, which are based on detailed fact finding and witnessing first-hand at trial the sworn testimony of the TCI Group's principals," they said.

RiskMetrics also "gave little weight" to CSX's performance measures and governance, the officials said. The board has delivered market- and industry-leading shareholder returns over the last one, three and five years.

"We believe the RiskMetrics recommendation is superficial, and that RiskMetrics has reached the wrong conclusion in failing to recommend the election of all of CSX's highly qualified directors," railroad officials said. "We urge all CSX shareholders to review the federal court's findings as well as the analyses of both CSX and the TCI Group and to exercise independent judgment."

Earlier this week, advisory firm Proxy Governance recommended shareholders elect Behring and Lamphrere to CSX's board.