NCR 2022

NCR 2022 Proxy Guide

NCR 2022 annual meeting is on May 2, 2022, at 9:00 am Pacific Time. It is a virtual-only meeting on the Mediant platform. I recommend voting in advance, especially since they have made it very difficult to vote at the meeting and maybe even to enter the meeting. To enhance corporate governance and long-term value, vote AGAINST Begor, Farrington, Larsen, Mucci, pay, and auditor; FOR Say on Termination Pay. $NCR

NCR Corporation provides various software and services worldwide. It operates through Payments & Network, Digital Banking, Self-Service Banking, Retail, and Hospitality segments. Below, is how I voted and why.

I voted with the Board’s recommendations 50% of the time. View Proxy Statement via SEC’s EDGAR system (look for DEF 14A).

Read Warnings below. What follows are my recommendations on how to vote the proxy in order to enhance corporate governance and long-term value.

NCR 2022: ISS Rating

From the Yahoo Finance profile page: NCR Corporation’s ISS Governance QualityScore as of April 1, 2022 is 10. The pillar scores are Audit: 9; Board: 10; Shareholder Rights: 7; Compensation: 10. Egan-Jones

Corporate governance scores courtesy of Institutional Shareholder Services (ISS). Scores indicate decile rank relative to index or region. A decile score of 1 indicates lower governance risk, while a 10 indicates higher governance risk.

NCR 2022: CorpGov Recommendations

ItemEgan-Jones Recommendation
1A – 1K – Election of DirectorsFOR except 1A. BEGOR, 1D.  FARRINGTON, 1G. LARSEN, and 1I. MUCCIAGAINST:  Begor, Farrington, Larsen, Mucci.
2 – Advisory Vote on Executive CompensationAGAINSTAGAINST
3 – Ratification of Independent AuditorsAGAINSTAGAINST
4 – Shareholder Proposal -Stockholder Ratification of Termination PayFORFOR

NCR 2022: Proxy Voting Notes

CEO pay is $14.8M. That is just too high for me. The CEO-to-worker pay ratio was 1:348. I voted against Executive Compensation and members of the Compensation Committee. Egan-Jones also agrees pay is unaligned. PricewaterhouseCoopers LLP has served for 29 years, so should no longer be considered an independent auditor. 

#4 Stockholder Ratification of Termination Pay

The proposal was written by me; submitted by Myra Young, so of course, I voted in favor. Last year, as I wrote the proposal, CEO Michael Hayford logged a 122% increase in his pay compared with 2019. That was $28.3 million in total compensation last year. The pay ratio to the “Median Compensated Employee” was 1:564. NCR shareholders did not like it. In an advisory say-on-pay vote in April, 84% of shareholder votes cast were against the compensation awards. It is in the best interest of NCR shareholders to be protected from any possible lavish management termination award.

As can be seen from the proxy and discussion above, NCR’s Board got the message and brought CEO pay closer to reasonable. However, it is still too high. Shareholder ratification of “golden parachute” severance packages with a total cost exceeding 2.99 times base salary plus target bonus better aligns management pay with shareholder interests. As Egan-Jones noted in their analysis,

we believe that adopting this proposal would put the Company at a competitive advantage in recruiting and retaining executive talent and that it is in the best interests of the  Company and its stockholders for the independent Compensation Committee to retain the flexibility to design and administer competitive compensation program.

Please vote For Proposal #4 for better shareholder value.

Other Recommendations

Proxy Insight had not reported any votes when last checked. 

In looking up a few funds in our Shareowner Action Handbook, I see Calvert voted a little less aggressively than I did.

NCR 2022: Issues for Future Proposalsinsightia

Looking at insightia for anti-shareholder provisions:

  • No requirement for an independent Chair
  • Supermajority requirements

NCR 2022: Mark Your Calendar

Stockholders interested in presenting a proposal pursuant to SEC Rule 14a-8 for possible inclusion in the proxy materials for NCR’s 2023 Annual Meeting of Stockholders must follow the procedures found in SEC Rule 14a-8 and the Company’s bylaws. To be eligible for possible inclusion in the Company’s 2023 proxy materials, all qualified proposals must be received by NCR’s Corporate Secretary no later than 5:00 p.m. Eastern Time on November 22, 2022.

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