In the major leagues of the stock market, H&R Block’s management is a weak-hitting shortstop.

That would appear to be the unusually tart assessment of Institutional Shareholder Services, an influential proxy advisory firm that smacked H&R Block Wednesday by throwing its support behind a group of dissidents led by former SEC Chairman Richard Breeden.
    
Now, it’s one thing for a tough-talking activist hedge fund manager to toss grenades at the target of his investment affections. Breeden Partners since late June has waged a campaign to elect three directors, arguing that management has put H&R Block in the cellar with ill-considered expansion into subprime mortgages, banking and brokerage.
 
ISS piled on.
    
“We conclude that the company’s long-term underperformance can be traced to either a failed diversification strategy or poor execution,” ISS said in its report.
 
But the harshest criticism came as ISS compared Block’s boardroom record of more misses than hits to Mario Mendoza, a former major leaguer with a lifetime batting average of .215, who–fair or not–is synonymous with weak hitting.
    
“Of course, companies should be free to test out new concepts and need not bat 1.000 when taking risks. However, it appears that H&R Block has batted below the “Mendoza Line” when it comes to its diversification strategy,” ISS said.

According to baseballlibrary.com, Mendoza was a good fielding shortstop who hit below .200 three straight seasons, 1975-77, and five times over a nine-year career. He played most regularly in 1979, where he hit .198 in 373 at-bats through 148 games for the Seattle Mariners.

But Corporate America is like baseball in one other way: Under-performing players are eventually replaced by proven veterans , see the New York Yankees, or a new hot prospect. In any case, with investors and analysts wondering if Block is a takeover target, it might not be long before Chief Executive Mark Ernst is heading for the showers.

(Image. Mario Mendoza, from www.baseball-almanac.com)