Tag Archives | chair

Broadridge Financial Solutions: My Vote – Proxy Score 64

Broadridge Financial SolutionsBroadridge Financial Solutions, Inc. (BR) is a provider of investor communications and technology-driven solutions to banks, broker-dealers, mutual funds and corporate issuers. They are one of the stocks in my portfolio. Their annual meeting is on November 12, 2015. ProxyDemocracy.org had collected the votes of two funds when I checked and voted. I voted with the Board’sProxyDemocracy.orgrecommendations 64% of the time. View Proxy Statement

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

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Take Action: Defend Your Vote – SEC’s Rule 14a-8(i)(9) Review

Hijacked- Rule 14a-8(i)(9) Review

Rule 14a-8(i)(9) Review

Take Action: Comment on SEC’s Rule 14a-8(i)(9) Review

As proxy season draws to an end, managers, boards and their legal advisors are calling on the SEC to allow companies to exclude shareholder proposals if a company includes a proxy proposal on the same subject, even if it would do the opposite of the shareholder proposal. That recommendation threatens to hijack the very existence of the proxy proposal system, which simply  allows shareholders to petition boards to take action and to put those petitions to a proxy vote to gauge support from  shareholders. Your meaningful vote in corporate elections and the foundations of democratic corporate governance are at stake. Continue Reading →

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American Express Company (AXP): Proxy Score 42

American ExpressAmerican Express Company (NYSE:AXP) is a global payments and travel company. The company, through its subsidiaries, offers products and services including charge and credit payment card products and travel-related services to consumers and businesses around the world. It is one of the stocks in my portfolio. Their annual meeting is coming up on 5/11/2015. ProxyDemocracy.org had the votes of four funds when I checked and voted on 5/4/2015. I voted with management 42% of the time and assigned American Express a proxy score of 42.

View Proxy Statement. Read Warnings below. What follows are my recommendations on how to vote the American Express 2015 proxy in order to enhance corporate governance and long-term value. Continue Reading →

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Gilead Sciences (GILD): Proxy Score 41

Gilead SciencesGilead Sciences $GILD is one of the stocks in my portfolio. They are a research-based biopharmaceutical company that discovers, develops and commercializes innovative medicines in areas of unmet medical need Their annual meeting is coming up on 5/6/2015. ProxyDemocracy.org had the votes of four funds when I checked and voted on 4/28/2015. I voted with management 47% of the time and assigned Gilead Sciences a proxy score of 47. Continue Reading →

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Starbucks Corporation (SBUX): Proxy Score 81

StarbucksStarbucks Corporation $SBUX, which operates as a roaster, marketer, and retailer of specialty coffee worldwide, is one of the stocks in my portfolio. Their annual meeting is coming up on 3/18/2014. ProxyDemocracy.org had the votes of four funds (now more) when I checked and voted on 3/8/2015.  I voted with management 81% of the time and assigned Starbucks a proxy score of 81.

View Proxy Statement. Read Warnings below. What follows are my recommendations on how to vote the Walt Disney 2015 proxy in order to enhance corporate governance and long-term value. Continue Reading →

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The Walt Disney Company (DIS): Proxy Score 79

DisneyThe Walt Disney Company $DIS, which operates as a worldwide entertainment company, is one of the stocks in my portfolio. Their annual meeting is coming up on 3/12/2014. ProxyDemocracy.org had the votes of four funds when I checked and voted on 3/8/2015.  I voted with management 79% of the time and assigned them a proxy score of 79.

View Proxy Statement. Read Warnings below. What follows are my recommendations on how to vote the Walt Disney 2015 proxy in order to enhance corporate governance and long-term value. Continue Reading →

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To Split or Not to Split? Independent Chair Proposals at Disney & Starbucks

Proxy MosaicThere has been much controversy in recent years surrounding the dual role of chair and CEO. The number of independent chair shareholder proposals seeking to separate the two positions has increased significantly and continues to rise. Both Disney and Starbucks have faced this issue in the past and shareholders once again have proposed to split the roles of chairman and CEO.

Will the momentum behind the independent chair proposals be enough to carry the vote? Or will Disney’s and Starbucks’ recent positive performance shield them from the ire of corporate gadflies? Can a combined chair-CEO truly be subject to adequate oversight?

Join Proxy Mosaic in a free webinar as they host a panel of experts to explore and debate these important issues. Continue Reading →

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How I Voted: Johnson & Johnson (JNJ) – Proxy Score – 76%

Johnson & Johnson ($JNJ) is one of the stocks in my portfolio. Their annual meeting is coming up on 4/25/2013. ProxyDemocracy.org had collected the votes of three funds when I checked on 4/22/2013.  I voted with management 76% 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. Continue Reading →

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Independent Board Oversight: Lessons from HP

Note: Republished with permission of the author. Originally published on the Bloxham Voice as Independent Board Oversight, 4/10/2011. Copyright The Value Alliance.

Nominating and governance processes and independent board oversight: Do they really matter? If so, to whom?

In a Digest publication late last year, I wrote about an ISS policy survey that found investors, in all markets, ranked board independence as the most important governance topic.

Of course, there are a number of ways independence is important. One is the independence of board members (including independent mindedness). Another is effective independent board oversight. Paralleling these are independent processes to nominate directors.

In a January 28 article for Fortune.com, I wrote:

HP’s 2010 proxy explains that the nominating and governance committee, Continue Reading →

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Moody's Shareowners Vote to Split Chair/CEO

At the annual meeting of rating agency Moody’s Investors Service, a resolution calling for an independent Chairman of the Board was supported by 56% of shareowners. The resolution was co-filed by Hermes Equity Ownership Services (EOS) and the Laborers International Union of North America (LIUNA).”

Citing both the Corporate Core Principles and Guidelines of the California Public Employees’ Retirement System (CalPERS) and the Millstein Center for Corporate Governance and Performance, the resolution stated,

We believe that the recent economic crisis demonstrates that no matter how many independent directors there are on the Board, the Board is less able to provide independent oversight of the officers if the Chairman of that Board is also the CEO of the Company.

via Institutional Shareowner.

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Effective Chair-CEO Relations

The number of U.S. companies that separate the chairman and CEO roles is at a historic high: 40% of the S&P 500 now separate the roles, up from 23% a decade ago, according to Spencer Stuart. Of the 40%, 19% may be classified as independent Chairs, up from 9% five years ago. A new report published by the Millstein Center for Corporate Governance and Performance at the Yale School of Management is among the first to outline how chairs and CEOs work effectively together in these interdependent roles, providing useful guidance as the chair-CEO leadership structure becomes more prevalent.

The Effective Chair-CEO Relationship: Insight from the Boardroom, authored by management expert Elise Walton, is based on interviews with 35 chairs, CEOs, and stakeholders. Participants identified key factors that contribute to a successful working relationship between the chair and CEO: good chemistry, a clear framework for the relationship, and having effective people and practices in place.

“Separate board leadership is still emerging in North America,” said Walton. “There is no Continue Reading →

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DTCC Splits Chair and CEO Positions

The company that holds legal title to about 80% of all American stocks announced this week that it will separate the role of chairman and chief executive officer following a two-year review of the organization’s governance.

Splitting the roles will increase its oversight of risk management and follows a growing trend by international companies that have adopted this reform.

The CEO will oversee the DTCC’s overall business strategy and operations that relate to the daily running of the company and will report to the chairman.

But it says that DTCC’s risk management and compliance departments will report directly to the chairman to heighten independence, leading to a system of “checks and balances” between the business and control functions. (Global Financial Strategy)

DTCC’s depository provides custody and asset servicing for 3.6 million securities issues from the United States and 121 other countries and territories, valued at almost $34 trillion. DTCC’s subsidiary, The Depository Trust Company (DTC), established in 1973, was created to reduce costs and provide clearing and settlement efficiencies by immobilizing securities and making “book-entry” changes to ownership of the securities. In 2009, DTC settled transactions worth more than $299 trillion, and processed 299.5 million book-entry deliveries.

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Walden Proposes Spit Chair/CEO at HP

Walden Asset Management filed a letter and resolution (WaldenHPLetterSepChairCEO8-10-10) with HP seeking separation of CEO and chair positions. Given the recent resignation of Mark Hurd (Mark Hurd’s Termination from HP: Case Study), timing seems ripe and important as HP searches for a new CEO. Walden cites Chairing the Board: The Case for Independent Leadership in Corporate North America by the Millstein Center for Corporate Governance and Performance at Yale’s School of Management. HP should take this opportunity to transition to this growing successful model of corporate governance and leadership.

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Whole Foods Splits Positions

Whole Foods Market Inc. said co-founder and Chief Executive John Mackey has given up the title of chairman in order to conform with current standards for good corporate governance. As of last spring, about 37% of companies in the Standard & Poor’s 500 stock index had separate chairmen and CEOs, up from 22% in 2002, according to the Corporate Library, a research firm in Portland, Maine. (Whole Foods CEO Gives Up Chairman’s Post, WSJ, 12/24/09)

Both the Conference Board’s Commission on Public Trust and Private Enterprise and the Council of Institutional Investors have long recommended roles of the CEO and Chairman be split to ensure an appropriate balance of power.

CEOs who retain the dual role make it extremely difficult to challenge a powerful chief executive if necessary to protect shareowner interests. When I approached WFMI on this issue several years ago, independent directors didn’t even routinely hold meetings without the CEO present. and be “more likely to have certain troubling governance characteristics than companies where the roles are separated.”

Spearheading the reform effort is the Chairmen’s Forum, an organization of independent chairs convened by The Millstein Center for Corporate Governance and Performance at the Yale School of Management. Last spring, Mary Schapiro told the Council of Institutional Investors that the SEC is “considering whether boards should disclose to shareholders their reasons for choosing their particular leadership structure – whether that structure includes an independent chair, a non-independent chair, or a combined CEO/chair.” If such a requirement goes through, expect withhold votes for directors at companies that provide poor explanations of why they haven’t split the roles.

As an activist shareowner of WFMI, I’ve been after them for years to make this change, along with others such as John Chevedden. I’m under no delusion that Mackey is now under the thumb of the board chair. I’m sure he remains the driving force behind WFMI. However, given his track record of blunders like faking his identity on blogs and denying shareowners the right to present resolutions during the business portion of the annual meeting, at least he now has a better chance of not making a mockery of WFMI’s shareowners. The content of Mr. Mackey’s online postings were directly at odds with the Company’s core values of transparency and stewardship. His refusal to allow shareowner resolution proponents an opportunity to speak during the normal business portion of an annual meeting, even though SEC Rule 14a-8(h)(3) requires that a proponent or representative of a resolution contained in the company proxy must present their proposal, also conflicted with our Company’s "Declaration of Interdependence," which "requires listening compassionately, thinking carefully and acting with integrity."

According to Richard Bernstein, chief U.S. strategist at Merrill Lynch, companies in the top 100 of the S&P 500 with split chairman and CEO outperformed those that combine the roles during the last decade. Corporations with split roles posted a 22% annual return since 1994, outpacing the 18% return earned by firms that did not. WFMI is a great company that could be even better if it took the role of shareowners as seriously it does that of customers and employees. Splitting the roles of CEO and chair is a good sign attitudes may be changing. Instead of viewing participation by shareowners as creating a circus atmosphere, as Mackey has characterized it in the past, maybe now we will see real dialogue that will increase long-term value.

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