Proxy Blog

Keycorp

April 12, 2018

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

  1. Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote 
  2. Shareholder vote on reducing threshold for special meetings 

Magni voted as follows: 

  1. Magni voted for and against the proforma proposals.
    -For all but two 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. The compensation levels are set using a benchmarking process. Two of the candidates (Crosby and Highsmith) are on the board as a result of prior acquisitions. These two positions should have independent board members.
    -For auditors – There appear to be no controversies with the financial statements of the company.
    -For “Say-on-pay” Advisory Vote. The proxy materials demonstrated that the board has more than considered shareholder feedback on executive compensation. In addition, the proxy materials disclosed the benchmarking done on executive compensation, including listing the peer group used in the benchmarking.

  2. Magni voted for shareholder proposal to lower threshold for special meetings. Strong shareholder relationships are part of good governance. Shareholders can be more engaged and feel more respected when the threshold for calling special meetings is low.