Priya Raghunathan· Head of People Analytics, Calibre Software
Asked in Executive Compensation ·
US-listed specialty retailer, about $4bn market cap. Our advisory vote came in at 71% this spring, down from 93%. The main issue was a bonus that paid at 112% of target in a year when the share price fell by a fifth, plus a retention grant to two executives.
I am drafting the response section for next year's proxy. Legal want two careful paragraphs saying we engaged and listened. The committee chair wants to set out plainly what investors objected to and what we changed, including the fact that we did not change the bonus metrics.
Has anyone gone the candid route, and did it help the following year's vote?
0 reactions · 4 replies · 4 views
Accepted answer· by Nadia Haddad
The proxy advisers look for three things after a vote under about 80%: how many holders you spoke to and what share of the register they represent, whether directors took part, and specific changes tied to specific feedback. If the draft does not give numbers on the first two it will be treated as boilerplate however well written. We reported outreach to holders of 62% of shares, meetings with 41%, the committee chair in every meeting. Where we kept something unchanged we said so and gave the reason in two sentences. Your chair's instinct is right.
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James OkaforCRP, CEP
VP, Total Rewards, Halcyon Financial Group
We went candid after a 64% vote. One table, three columns: what we heard, what we did, and where we decided not to act and why. The third column was the one investors mentioned afterwards. The next vote was 91%. I do not think the two careful paragraphs would have achieved that.
Nadia HaddadCRP
Director of Rewards, MEA, Qasr Holdings
Accepted answer
The proxy advisers look for three things after a vote under about 80%: how many holders you spoke to and what share of the register they represent, whether directors took part, and specific changes tied to specific feedback. If the draft does not give numbers on the first two it will be treated as boilerplate however well written.
We reported outreach to holders of 62% of shares, meetings with 41%, the committee chair in every meeting. Where we kept something unchanged we said so and gave the reason in two sentences. Your chair's instinct is right.
Dana WhitfieldCRP, GRS
Director, Global Compensation, Meridian Health Systems
A caution from the legal side of the table. Being plain about what investors objected to is fine. Being plain about which investor said what is not, and I have seen drafts drift there. Keep it to themes, and have each quoted theme checked against the meeting notes.
Nadia HaddadCRP
Director of Rewards, MEA, Qasr Holdings
Helpful, thank you. We are going with the three-column table and the outreach numbers up front. Legal are comfortable provided it stays at the level of themes. I will report back after the next vote.
