Juniper Networks, Inc. (JNPR): Proxy Score 80%

Juniper Networks, Inc. ($JNPR) is one of the stocks in my portfolio. Their annual meeting is coming up on 5/21/2013. had collected the votes of three funds when I checked on 5/13/2013.  I voted with management 80% of the time.  View Proxy Statement. Warning: Be sure to vote each item on the proxy. Any items left blank are voted in favor of management’s recommendations. (See Broken Windows & Proxy Vote Rigging – Both Invite More Serious Crime)

I generally vote against pay packages where NEOs were paid above median in the previous year but make exceptions if warranted. According to Bebchuk, Lucian A. and Grinstein, Yaniv (The Growth of Executive Pay), aggregate compensation by public companies to NEOs increased from 5 percent of earnings in 1993-1995 to about 10 percent in 2001-2003.

Few firms admit to having average executives. They generally set compensation at above average for their “peer group,” which is often chosen aspirationally. While the “Lake Woebegone effect” may be nice in fictional towns, “where all the children are above average,” it doesn’t work well for society to have all CEOs considered above average, with their collective pay spiraling out of control. We need to slow the pace of money going to the 1% if our economy is not to become third world.

JNPR’s Summary Compensation Table shows Stefan Dyckerhoff, Executive VP, was the highest paid named executive officer (NEO) at about $7.5M in 2012. I’m using Yahoo! Finance to determine market cap ($8.7B) and Wikipedia’s rule of thumb regarding classification. JNPR is a mid-cap company. According to the United States Proxy Exchange (USPX) guidelines (pages 9 & 10), using data from Equilar, the median CEO compensation at mid-cap corporations was $4.3 million in 2010.

JNPR’s pay is above median, especially if we factor inflation.  Therefore, I voted against the pay package. I would have also voted against the members of the compensation committee. However, JNPR had a classified board (in the process of being declassified over several years) and none of the compensation committee members were up for reelection this year.

How I voted (CorpGov) below:

1.1Pradeep SindhuForForForForWithhold
1.2Robert M. CalderoniForForForForFor
1.3William F. MeehanForForForForFor
2Ratify AuditorsForForAgainstForAgainst
3NEO CompensationForAgainstForForFor
Mark your calendar:

For a stockholder proposal to be considered for inclusion in Juniper Networks’ proxy statement for the 2014 annual meeting, the written proposal must be received by the Corporate Secretary of Juniper Networks at our principal executive offices no later than December 10, 2013. If the date of the 2014 annual meeting is moved more than 30 days before or after the anniversary date of the 2013 annual meeting, the deadline for inclusion of proposals in Juniper Networks’ proxy statement for the 2014 annual meeting is instead a reasonable time before Juniper Networks begins to print and mail its proxy materials for the 2014 annual meeting. Such proposals also will need to comply with SEC regulations under Rule 14a-8 regarding the inclusion of stockholder proposals in company-sponsored proxy materials. Proposals should be addressed to:

Juniper Networks, Inc.
ATTN: Corporate Secretary
1194 North Mathilda Avenue
Sunnyvale, CA 94089
Fax: (408)745-2100

 Looking at, I see No action can be taken without a meeting by written consent at JNPR. It also has supermajority vote requirement (66.67%) to amend certain charter and certain bylaw provisions.

Juniper Networks, Inc.’s ISS Governance QuickScore as of May 1, 2013 is 10. The pillar scores are Audit: 1; Board: 7; Shareholder Rights: 6; Compensation: 10. Brought to you by Institutional Shareholder Services (ISS). Scores range from “1” (low governance risk) to “10” (higher governance risk). Each of the pillar scores for Audit, Board, Shareholder Rights and Compensation, are based on specific company disclosure.

Given JNPR’s stock is down over 1, 2 and 5 year periods and the poor ISS score of 10, maybe it is time for shareowners to ban together and make a difference using

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