The annual proxy for this retailer had the following proposals:
- Proforma votes on directors, appointment of auditors, and “say-on-pay” advisory vote
- Shareholder proposals on:
-Racial or ethnic pay gaps
Magni voted as follows:
- Magni voted for and against proforma proposals.
- For all except one director. 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.Only one Walton needs to be on the board, so Magni voted against Stuart Walton.
- For auditors. There appear to be no controversies with the financial statements of the company.
- Against “Say-on-pay” proposal. The proxy disclosures were perfunctory. Key missing disclosures included explanations of major contract clauses and data used in benchmarking compensation.
Magni voted for and against shareholder proposals.
- For independent chair – Generally having an independent director as board chair is a good idea, though there are instances where a combined CEO and Chairman make sense, especially in companies at an early stage. Walmart is sufficiently mature to separate the roles.
- Against racial or ethnic pay gaps – The justification for the proposal was mainly a regurgitation of Economic Policy Institute generic information along with a diatribe about involuntary part-time work. Walmart has received numerous awards for its diversity and inclusion practices. The proposal appears primarily designed to push a political point.