Proxy Blog

Intel Corporation

May 7, 2019

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

  1. Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote 
  2. Board proposal on amending the equity incentive plan 
  3. Shareholder proposals on written consent, gender pay gap, and political contributions 

Magni voted as follows: 

  1. For proforma proposals.
    -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. 
    -Auditors – There appear to be no controversies with the financial statements of the company.
    -“Say-on-pay”  The company listed the peer group this year, in contrast to last year when it was hidden. The criteria were clear, though a bit subjective. The company shows its percentile position within the group across the key metrics used to determine it. The shareholder engagement was documented with specific material on the executive compensation discussions. While Magni looks for very objective criteria, the increased disclosure is sufficient to win Magni’s support, but only for this year. 
  2. For the board proposal. Long-term 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. 
  3. For and against shareholder proposals.
    -Against written consent – Per the Magni position paper, Magni routinely votes against written consent proposals.
    -Against gender pay – Gender equity is an important issue. That said, there are two reasons for voting against the proposal. The first is the use of generic and inaccurate information in the shareholder’s supporting statement, along with the proposal requiring the company to report a misleading metric for gender equity. The second is the company’s prior and current efforts to address gender inclusion. The company has made good progress and should be encouraged to continue with its current efforts.
    -For political contributions – Last year there was a similar proposal. It was generic and did not identify material shortcomings with the behavior of the company. Last year’s proposal was mainly an explanation of the shortcomings of the Citizens United case. This year’s proposal identifies some embarrassing consequences of the company’s political activities. As such, Magni supported the proposal.