Proxy Blog

National Grid plc

July 9, 2018

National Grid plc, a British multinational electricity and gas utility company, provided its annual proxy. This proxy had the following proposals: 

  1. Proforma votes on directors and appointment of auditors 
  2. Proforma European votes on approval of accounts and annual confirmation of authorities 
  3. Board proposals on:
    -Remuneration
    -Shortening the notice period for shareholder meetings 

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. The compensation levels are set using a benchmarking process.
    -Auditors. There appear to be no controversies with the financial statements of the company.

  2. For European proforma proposals.
    -Accounts & authorities. None of the topics had any identified controversies. Under US laws and regulations, these matters are handled by the board, thus the topics do not warrant votes by shareholders of US companies. Magni votes in support of these topics, unless some controversy or issue has arisen that requires additional investigation or justifies a vote against.

  3. Against board proposals.
    -Remuneration. The proxy materials did not contain a remuneration report. Magni votes against opaque proposals.
    -Shortening the notice period for shareholder meetingsThe board wants to be able to call shareholder meetings with less than 14 days of notice. There was little justification provided regarding the imperative for such a change. Given that the existing notice period appears to have been in place for quite some period, and it is conceivable that some shareholders may require a fortnight to be contacted, the status quo appears appropriate.