The annual proxy for this nonalcoholic beverage company had the following proposals:
- Proforma votes on directors, the appointment of auditors, and executive compensation
- Shareholder proposal on report regarding sugar and public health
Magni voted as follows:
- 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” advisory vote – A relatively complete disclosure is marred by a lack of benchmarking of the company against its peer group.
- Against shareholder proposal. The topic of sugar is significant as in the US, and increasingly around the globe, there is a rapid increase in obesity and diabetes. Sugar-based drinks are part of the problem. That said, Magni voted against the proposal for two reasons: (1) the proposal is rambling and appears to try to tarnish Coca-Cola with a broad range of allegations, often unrelated to the proposal; and (2) the proposal covers the same ground that a group called ATNF produces. ATNF is funded by independent entities, such as the Bill & Melinda Gates Foundation, the Dutch Ministry of Foreign Affairs, and the Robert Wood Johnson Foundation. Last year we noted that a more focused proposal with recommendations on reasonable changes would warrant a favorable vote. This is the same proposal. Should it be offered next year, Magni will vote against, once again. Next time, an explanation will not be required.