Proxy Blog

Biogen Inc. 

May 15, 2019

The annual proxy for this biotechnology company had the following proposals: 

  • Proforma proposals on directors, appointment of auditors, and “say-on-pay” advisory vote 

Magni voted for and against proforma proposals. 

  • For directors  The board has a majority of independent directors and some have CEO/CFO experience with other companies. The compensation of directors is disclosed with a meaningful portion in equity where the equity has restrictions to align director incentives with long-term value creation. 
  • For auditors – There appear to be no controversies with the financial statements of the company. 
  • Against say-on-pay”  The proxy materials disclosed the existence of a stockholder engagement program, though not the amount of activity. The peer groups were listed, though the criteria were very high level and the company was not compared to the peer groups on relevant metricsSuch an opaque process for managing the peer groups creates the opportunity for gerrymandering. Opaqueness in the level of shareholder engagement activity means that the company may not be getting much feedback on the shortcomings of the governance practices related to executive compensation.