Scott’s Miracle Gro, Becton Dickinson, Visa, Jacob’s Solutions, Walgreens
PROXY COUNTDOWN SCRIPT
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This is Proxy Countdown. Welcome to the big show for the week of January 20, 2025 alongside my tag team partner Matt Moscardi. I'm Damion Rallis. On today’s countdown:
Ulta Beauty has come to their senses
Mellody Hobson is googling “Dunkin”
No more women at Southwest Airlines
ISS has very picky tastes
And on The Big Vote, is this the year shareholders come to their senses on Drug KingPin Stefano Pessina?
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Trade Wire - BUY/SELL
Top Stories:
CEO David Kimbell has resigned at Ulta Beauty and has been replaced by COO Kecia L. Steelman. This should also correct the board’s -7% gender gap at a company where about 80% of customers are women.
JPMorgan Chase elevated Jennifer Piepszak to COO as part of a new management reshuffling, but the bank said that Piepszak doesn’t want to succeed Jamie Dimon as CEO, adding even more uncertainty to the race to succeed Jamie.
This means that the man who has long been known as the “hit by the bus executive”--CEO Jamie Dimon's stand-in in case of an emergency, Daniel Pinto–will step down as JPMorgan's COO in June and retire at the end of 2026.
The corporate world has lost a 95-year-old Executive Chair, Milton Cooper at Kimco Realty, but don’t worry too much as he will be sticking around as Chair Emeritus where there will be an envelope under his chair every year with $70,000 cash and $175,000 equity.
Long time Duke Energy CEO and Chair Lynn Good will resign after more than a decade: she is being replaced by Harry Sideris as CEO while Lead independent director Ted Craver will become independent chair.
Two top women are stepping down at Southwest Airlines: CFO Tammy Romo and Chief Administration Officer Linda Rutherford. This is a win for the anti-DEI crowd of course but who are they going to blame now if anything goes wrong at the Airlines as there are no women left in senior leadership positions.
The grand dame of corporate governance is out at Starbucks. Mellody Hobson, who has been chair of the Audit Committee, Vice Chair of the Board, Chairman of the Board and independent lead director is stepping down after almost two decades. CEO Brian Niccol will now rule with an iron fist as Mellody’s 22% influence walks away.
Kristen Riggs, President, Salty Snacks of The Hershey Company has resigned to pursue other opportunities. But what other opportunities could there possibly be? President, Sour Pickles? Vice President, Sticky Pudding?
And finally, Goldman Sachs CEO/Chair David Solomon and COO John Waldron each received retention grants worth $80M just to keep… um… doing their jobs. $39M wasn’t enough for DJ D-Sol I guess, vinyl is expensive.
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PROXY CAGE MATCH
Under intense pressure from activist investor Mantle Ridge, Air Products announced that it will separate the roles of CEO and board chair and that current CEO and Chair Seifi Ghasemi will retire in the next few months.
Mantle Ridge also nominated four dissident directors to the Air Products board:
Glass Lewis supported all four directors while ISS said yes to the 3 men but not the black woman: Tracy McKibben
Preliminary tallies show Mantle Ridge's founder, Paul Hilal, Andrew Evans and Dennis Reilley have been elected to the board while shareholders rejected CEO Ghasemi and lead director Edward Monser.
Activist investor Gatemore Capital Management has called for the replacement of YouGov CEO Steve Hatch based on "lacklustre" share price performance.
And Barington Capital Group, owning approximately 2% of Matthews International, is nominating three directors - Ana B. Amicarella, Chan W. Galbato, and James Mitarotonda - for election to Matthews' Board at the 2025 Annual Meeting.
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VOTE RESULTS TABLE
Shareholders have no comment at D.R. Horton
Shareholders narrowly passed a shifty amendment to the company’s 2018 Equity Incentive Plan to eliminate its original 10-year term: 56% said yes but co-founder/CEO/Chair Jay Chaudhry controls at least 20% of the vote, if not up to 40% through family trusts.
Overboarded director Charles Giancarlo received nearly 40% votes against
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THE BIG VOTES
SCOTTS MIRACLE GRO
AGM Date: January 27, 2025
Matt:
Obvious win
The company makes in the bottom third of industry peers - I know it’s hard to say goodbye, but Hagerdorn is the kid who made the merger between Miracle-Gro and Scott’s happen… in 1995… can we move on to 2025 and ditch nepo baby?
Side note: Hagerdorn paid fines for coating birdseed with pesticides lethal to birds and paid the largest insecticide fines to date for 11 criminal violations
Backdoor win
Hagedorn family owns 26% of voting control through straight share ownership - it’s a dictatorship without a formal dictator because everyone would have to vote in lockstep against “the family”
Doesn’t mean you can’t hold directors accountable - even if the Hagedorn’s - CEO Jim among them - pretty much hand pick the board, David Evans at least is on another board actively (Cardinal Health) that isn’t a dictatorship. Don’t like the dictator? Vote out the enablers elsewhere - NO on Evans
Damion: only 2 women on board and only 4 directors up for election: David C. Evans, Adam Hanft, Stephen L. Johnson and Katherine Hagedorn Littlefield. Get rid of useless Johnson (4%) and Hanft: both from 2010 and replace them with 2 women
BECTON DICKINSON
AGM Date: January 28, 2025
Matt:
Obvious win
Bertram Scott is not independent
Lead “independent” director, still there after 22 years
Maybe still there because he has the most powerful network of anyone on the board?
Damion: Another boy’s club at -18% gender gap. Is this why we see a 396:1 CEO Pay ratio? Get rid of COmpensation COmmittee chair R. Andrew Eckert (8%) and committee member Bertram L. Scott (11%) who has been there since 2002; 9% said NO to Scott last year
VISA
AGM Date: January 28, 2025
Matt:
Obvious win
Francisco Javier Fernandez-Carbajal is not independent
Why do investors keeping voting for a director with 17 years on the board?
Below average batting on TSR, earnings
Fernandez-Carbajal one of three directors who have stayed on the board since Al Kelly’s CEO-ship
Backdoor win
Visa is one of the most connected boards in our database (55% directors are connected), and Denise Morrison is by far the most connected on the board - connected to 4 directors 5 ways, but most connected to departed board as well
Why it matters? Sitting on boards with people in your business circle is good for expediting decisions (short timeline to get to agreement), but bad for risk assessment (no one wants to challenge their business buddies)
The connections are entirely through Blue Chip US companies - Clorox (major data breach), Goodyear (more than 70,000 open asbestos cases, being sued by EPA), Disney (woke), Quest Diagnostics (11 million patient data breach) - so if you want to live at the top, you don’t get there by dissenting
Fan favorite
NLPC makes a wonderfully cynical ask for a report on how company that says it doesn’t discriminate against gender might be discriminating against DE-transitioning employees through its benefits programs
It’s fantastic smoke and mirrors that has nothing to do with Visa and everything to do with transphobia, but Visa has 31,000 employees - studies show 0.5% of adults identify trans and about 10% detransition (which is one study and impossible to corroborate). That would mean this proposal targets 15 possible employees at Visa. Meanwhile, NLPC files at other companies to get rid of the DEI programs that at Visa cover 6,600 black and hispanic employees
Damion:
gender gap is -11%, led by CEO Ryan McInerney (17%) and Chair Terry Lundgren 22%). Break up the boys club by either demoting Terry or voting him off. Promote Pamela Murphy to chair: finance background, worked at Oracle, most recently CEO of cybersecurity company; only 51 (compared to Terry’s 73)
Fat no on hate SHP: “Gender-Based Compensation Gaps and Associated Risks” from the National Legal and Policy Center,
Yes on New York City Carpenters Pension Fund’s “New Director Election Resignation Governance Guideline” where two straight failed majority votes results in byebye
JACOBS SOLUTIONS
AGM Date: January 29, 2025
Matt:
Obvious win
FOUR women with an average of 3% influence EACH?
Ed Eberhart is the head of the nom committee - why not put one of the women there to find some more women and add some female power to the board? Vote out Eberhart.
Damion: vote out Pay Committee chair and longest-tenured (2009) director Peter J. Robertson and his 25% influence; address the company’s -21% gender gap; 9% said no last year.
WALGREENS BOOTS ALLIANCE
AGM Date: January 30, 2025
Matt:
Obvious win
Steffano Pessina must go.
There are 44 directors in the US over the age of 80 years old with over 50% influence at their companies - the Golden Age Directors reliving the hits and WON’T GO AWAY, Pessina among them
The average tenure is 33 years
The company is in freefall, and Pessina tapped his friend’s company to install video ad windows on refrigerators, then fired Roz Brewer when she killed it because they were horrible
He is married to another executive at the company
He is the shadow CEO with no real oversight - he didn’t build the company, but he gets founder treatment and huge shareholdings keep him there
Backdoor win
There are three women who basically have been there for the entirety as the Pessina enablers - Jan Babiak, Nancy Schlichting, Ginger Graham
Schlichting is the pay chair, has been there since 2006, and has no real influence - time to change the guard, someone has to reign in Pessina if he stays
Damion:
Get rid of Pessina. He’s already the major shareholder (17%) so he’ll still be around no matter what.
“Stefano Pessina, our Executive Chairman, is and will be older than the retirement age as of the date of the Annual Meeting. However, as described further in “—Director nomination process—Shareholders’ agreement and other agreements with Mr. Pessina” above, Mr. Pessina is the contractual designee of the SP Investors (as defined above) for nomination to the Board, and the Shareholders’ Agreement (as defined above) includes a contractual waiver of any mandatory retirement age policy applicable to his service on the Board.”
32% supported 2024 SHP to “Whenever possible, the Chairman of the Board shall be an Independent Director”
DAMION:
That’s the Proxy Countdown for the week of January 20, 2025. Join us next week when we jump back into the Alternative Democracy pool... forever on the lookout for shareholder sharks and wayward directors drinking rancid water.
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