The annual proxy for the nationwide used car dealer had the following proposals:
- Proforma proposals on directors, appointment of auditors, and “say-on-pay” advisory vote
- Board proposal on stock incentive plan
- Shareholder proposal on disclosure of political contributions
Magni voted as follows:
- 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 disclose a commitment to shareholder feedback, though no activity was disclosed. The materials disclose the peer group, though the criteria is high level. The materials did not include a comparison of the company to the peer group. The disclosures regarding executive compensation remain opaque, and opaqueness is inconsistent with good governance.
- For board proposal. Equity incentive plans are a good tool for aligning management of a company with shareholder interests. The amendments to the existing plan are relatively minor and the changes are consistent with good governance.
- Against shareholder proposal. The company already discloses political activities. This proposal mostly seeks to lump industry group activities with political activities. There are good reasons for a company to participate in an industry group. Many of those reasons are unrelated to lobbying. Assuming all such industry activity as political is wrong.