Proxy Blog

Walgreens Boots Alliance, Inc. 

January 7, 2020

The annual proxy for this pharmacy-led, health and wellbeing company had the following proposals: 

  1. Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote 
  2. Shareholder proposals on independent chairman, deferral period on executive compensation, and lowering threshold for special meetings 

Magni voted as follows: 

  1. For and against the proforma proposals.
    -For directors – The board has a majority of independent directors, while the target skill sets for the board are disclosed along with the fit of the candidates to the target skills. 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 has a shareholder engagement program where the level of activity is disclosed, and the discussions include compensation. The peer group is disclosed. That said, the criteria for the peer group is high level and the company has a market capitalization below the average of the peer group. Such a situation can place an upward bias on compensation levels. 
  2. For and against shareholder proposals.
    -For independent chairman – Per the Magni position paper, Magni routinely votes in favor of these proposals.
    -Against deferral of executive compensation – The proposal seeks to prevent senior executives from “gaming” metrics to increase compensation. While good in theory, the company is well run and already has “clawback provisions. Unless there are specific instances where the company practices are shown to be insufficient, this type of matter should be left to the board.
    -For lowering the threshold for special meetings – Per the Magni position paper, Magni routinely votes in favor of these proposals.