Proxy Blog

Union Pacific Corporation 

April 15, 2019

The annual proxy for this railroad company had the following proposals: 

  1. Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote 
  2. Shareholder proposal on independent chairman 

Magni voted as follows: 

  1. For and against proforma proposals.
    -F0r 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” Advisory Vote – The proxy materials discussed shareholder engagement, though the evidence of actual engagement activities was focused on participation in conferences. Shareholder engagement needs to include existing shareholders. Conferences focus on finding new shareholders. The peer group is listed, but the process for determining the group is vague. The company needs actual shareholder engagement and more transparency in the peer group process. 
  2. For the shareholder proposal. Magni wrote a position paper regarding shareholder proposals for independent chairman.