The annual proxy for this insurance company had the following proposals:
- Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote
Magni voted 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. The compensation levels are set using a benchmarking process.
- For auditors – There appear to be no controversies with the financial statements of the company.
- Against “say-on-pay” – The proxy materials did not disclose the companies in the peer group used for benchmarking compensation. The selection of a peer group has a significant impact on the pay targets. Transparency about compensation matters is demonstration of a board’s independence. Opaqueness regarding key benchmarking considerations is not consistent with good governance.