Proxy Blog

Quest Diagnostics Incorporated

May 6, 2019

The annual proxy for this clinical laboratory company had the following proposals: 

  1. Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote 
  2. Management proposals on amended long-term incentive plan 

Magni voted as follows: 

  1. For and against the 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 proxy materials documented the shareholder engagement program, with compensation as one of the topics. The peer group was listed though the criteria was about “generally” competing with the company. That is vague and subject to gerrymandering. 
  2. For the management 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.