Allie Monaco, Research Manager of Manifest’s US partners, Proxy Governance takes a look at the hot issues of the US proxy for the coming two weeks:
Company |
Meeting |
Proposal |
Note |
American Express Co |
26-Apr |
Adopt cumulative voting |
Long-time target of Evelyn Davis, this year’s proposal asks for cumulative voting; the company has majority voting in director elections |
Special meeting by shareholders |
Company does not allow shareholders to call special meetings; proponent requests a 10% threshold |
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Stock retention |
Proponent wants a more rigorous retention requirement given the company’s reliance on equity compensation |
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Boeing Co |
26-Apr |
Military issues |
Faith-based investors push for more ethical consideration in contract bids |
Say on pay |
Company presses familiar line in opposition: “wait and see what regulation brings” |
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Special meeting by shareholders |
Proponent seeks to lower the existing 25% threshold to 10% |
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Independent chair |
Board already provides for a lead director; resolution won 30% of the vote in 2009 |
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Political contributions |
Won 28% of the vote last year; about average for the proposal in 2009 |
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Honeywell International Inc |
26-Apr |
Written consent by shareholders |
Board has shown general responsiveness to investor concerns, including lowering special meeting threshold to 20% (from 25%) at this year’s meeting |
Independent chair |
Company has no formal lead director; presiding director rotates on meeting-by-meeting basis |
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Global labor practices/human rts |
Existing policy lags peers on freedom of association and collective bargaining |
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MDC Holdings Inc |
26-Apr |
Independent chair |
Average director tenure is 20 years; lead director has 16 year tenure |
Ameren Corp |
27-Apr |
Report relating to nuclear plant |
Proponent concerned for moral and financial liability in extending plant for another 40 years |
BB&T Corp |
27-Apr |
Political contributions |
Company does not make direct corporate contributions, but may via trade association fees |
Independent chair |
Rare binding bylaw proposal; 25-year veteran currently serves as lead director |
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Overdraft policies and practices |
Several large banks have eliminated overdraft fees, which resolution requests |
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Fortune Brands Inc |
27-Apr |
Special meeting by shareholders |
Company has been responsive to shareholder concerns – agreeing to eliminate its classified board and supermajority vote provisions |
International Business Machines Corp |
27-Apr |
Defer bonus payments |
Proponent argues short-term incentive plans without effective safeguards can encourage excessive short-term risk-taking. Company’s compensation practices are reasonable |
Adopt cumulative voting |
Similar proposal from Evelyn Davis each year since 2003; last year’s proposal received support from 35% of the votes cast |
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Special meeting by shareholders |
Proponent seeks to lower the existing 25% threshold to 10% |
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Say on pay |
Third year company has been targeted with this proposal; 2009 support 40% of votes cast. |
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SCBT Financial Corp |
27-Apr |
Declassify board |
First year proposal for this 15-member board |
State Bancorp/NY |
27-Apr |
Special meeting by shareholders |
Company responsive on other issues – held special meeting in December 2009 to declassify board and eliminate supermajority vote requirements following shareholder proposals on these issues |
Suntrust Banks Inc |
27-Apr |
Sustainability |
Unusual effort to push sustainability reporting to regional banks |
UMB Financial Corp |
27-Apr |
Declassify board |
Proposal in last two years received just under majority of votes cast |
Wells Fargo & Co |
27-Apr |
Say on pay |
Already has voluntary advisory vote on ballot; proponent wants director compensation included in vote |
Independent chair |
AFL-CIO Key Vote; last year a binding bylaw version (this year’s is precatory) received 28% support |
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Charitable activities |
Proponent cites concerns over giving to gay and lesbian charities |
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Political contributions |
Company does not make direct corporate contributions, but may via trade association fees |
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Ball Corp |
28-Apr |
Say on pay |
Company did not respond to four majority-supported shareholder proposals to declassify the board; changes to Indiana law now lock in classified structure. Pill proposal sponsored by CalSTRS |
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Shareholder approval of poison pill |
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Bank Of America Corp |
28-Apr |
Report on non-deductible compensation |
New proposal seeks explanation on failure to optimize tax deductibility of pay |
Special meeting by shareholders |
Proponent seeks to lower the existing 25% threshold to 10% |
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Say on pay |
Under terms of SEC settlement, already has advisory vote on ballot |
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Succession planning policy |
Board claims existing disclosures render proposal moot |
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Over-the-counter derivatives trades |
Requests disclosure on recycling of collateral posted on derivatives trades, citing practice as factor in Lehman Bros collapse |
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Recoup unearned management bonuses |
AFL-CIO Key Vote; company recently enhanced clawbacks, but proposal goes further |
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Dover Motorsports Inc |
28-Apr |
Eliminate restrictions on class A shares |
Rather than eliminate dual class stock, requests transferability and public trading of the supervoting stock |
Du Pont (E I) De Nemours |
28-Apr |
Say on pay |
Received 46% support last year; about average in 2009 |
Global labor practices/human rts |
Repeat of 2008 resolution (3.5% support) that raises concern for enforcement of seed patents within traditional agricultural groups |
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EOG Resources Inc |
28-Apr |
Hydraulic fracking |
New proposal raises concerns over impacts of natural gas drilling |
Stock retention |
Company argues it could lose executives if implemented |
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No acelerated vesting |
New proposal would eliminate accelerated equity vesting on change of control |
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General Electric Co |
28-Apr |
Adopt cumulative voting |
Proponent has submitted the same proposal since 2005; support in past three years has hovered between 32% – 35% of votes cast. |
Special meeting by shareholders |
Proponent seeks a 10% threshold; company allows at 25%, reduced from 40% threshold a year ago |
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Independent chair |
Similar proposals submitted in 2008, 2007 and 2006, receiving 32%, 31% and 15% of the votes cast, respectively. |
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Policy on director opposition votes |
Would prohibit any director who with greater than 20% withhold votes from serving on key board committees; two directors crossed that threshold in 2009 |
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Say on pay |
In 2009 and 2008, similar proposals received support from 43% and 38% of votes cast |
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McGraw-Hill Companies |
28-Apr |
Special meeting & written consent by shareholders |
Successive majority votes on a variety of issues in prior years including elimination of classified board and supermajority votes; both are now management proposals this year |
Weis Markets Inc |
29-Apr |
Increase Independence on Board |
Executive, who is also the chairman’s son, chairs Compensation Committee. As controlled company, director independence not a requirement of the stock exchange for Committee membership |
Providence and Worcester Railroad |
28-Apr |
Director retirement age |
Proposes director retirement age of 75; 3 directors currently older than 75, 5 over 70 |