Proxy Blog

Pinnacle West Capital Corporation

May 6, 2019

The annual proxy for this electric utility holding company had the following proposals: 

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

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 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 company significantly strengthened shareholder engagement and that is good. However, the peer group is custom and the criteria for inclusion is vague, so there is an opportunity for gerrymandering. 
  2. For the shareholder proposal on lowering threshold for special meetings to 10%. Good governance means open communications with shareholders.