Proxy Blog

F5 Networks, Inc. 

February 12, 2020

The annual proxy for this network services company had the following proposals: 

  1. Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote 
  2. Board proposal on incentive compensation plan 

Magni voted as follows: 

  1. 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, though the equity does not have 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 a shareholder engagement program where executive compensation was a topic, though the level of activity was not disclosed. There was high-level peer group criteria and the peer group was listed, though the company is smaller than the companies in the peer group thus risking an upward bias on compensation. 
  2. For board proposal on a revised long-term incentive plan. Such plans are good tools for aligning management of a company with shareholder interests.