Founder boards, plus Zaslav’s payday, and the death of shareholder proposals

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PROXY COUNTDOWN

Free Float Media, Inc.

61 episodes

1 week ago

This is Proxy Countdown. Welcome to the big show for the week of November 3, 2025 alongside my tag team partner Matt Moscardi. I'm Damion Rallis. On today’s countdown: Some mysterious director NO votes More one-time retention awards for our CEO king and queens A dude wants to control Victoria’s Secret The ongoing disappearance of shareholder proposals Matt’s halloween director roundup Trade Wire - BUY/SELL Top Stories: proxy countdown_trade wire_2025 - Google Sheets Tracking Noteworthy 8-Ks since October 8th: DIrector comings and goings: Men added: Men subtracted: Women added: Women subtracted: Stick to 2F TransDigm Group INC (TDG) : appointed Michael Lisman and Peter Palmer Down to 2F: Down to 1F: Stupidities/Oddities: TEXTRON INC (TXT) appointed Lisa M. Atherton CEO/director Ms. Atherton will receive an annual base salary of $1.3M and target annual incentive compensation of 150% of her base salary former CEO Scott C. Donnelly will become Executive Chairman Mr. Donnelly will receive an annual base salary of $1.485M and target annual incentive compensation of 170% of his base salary the Board approved an amendment to the Company’s amended and restated by-laws to accommodate the appointment of an Executive Chairman F5, INC. (FFIV): CEO François Locoh-Donou will become Chair after 2026 AGM Mr. Locoh-Donou will succeed current Chair, Alan J. Higginson, who, as previously announced, will be retiring after nearly 30 years as a Company director and 20 years as the Company’s Chair. Michael Montoya resigned as director but then Michael Montoya appointed CTO In October 2025, F5 disclosed a security incident involving a nation-state threat actor who gained long-term, persistent access to its product development and knowledge management systems, exfiltrating some BIG-IP source code and vulnerability information. Toast, Inc. (TOST): appointed Anutthara Ramamurthy Bharadwaj, will hold office until the 2028 annual meeting CLOVER HEALTH INVESTMENTS, CORP. /DE (CLOV): Chelsea Clinton resigned CNA FINANCIAL CORP (CNA) Dino E. Robusto’s tenure as Executive Chairman will end on December 31, 2025 CEO Douglas M. Worman will become Chair TEXAS INSTRUMENTS INC (TXN) Richard K. Templeton resigning as executive chairman CEO Haviv Ilan appointed as executive chairman NEOs CEOs Money CITIGROUP INC: CEO Jane Fraser: one-time retention award; one-time RSU equity award of $25M and 1.055M options to CEO MP Materials Corp. / DE (MP): one-time grant of restricted stock units with performance conditions to NEOs: total $28M VERIZON COMMUNICATIONS INC (VZ): $70m golden hello to new CEO Dan Schulman PROXY CAGE MATCH BBRC International, which owns a nearly 13% stake in Victoria’s Secret, delivered a letter to the Victoria’s Secret’s board of directors this week calling for the removal of Chair Donna James and asking for a board seat. Pushing Brett Blundy, who runs BBRC James, the company’s chair, served on the board of L Brands—Victoria’s Secret’s previous parent company—for nearly two decades before the 2021 spinout. “By any measure, she is an ‘over-tenured’ director with a ‘stale perspective’ that lacks objectivity regarding the company’s operations,” Blundy wrote in the letter this week. American Electric Power (2022-2025) and Hartford Financial (2021-) Directors who all serve on 2 other boards: Irene Chang Britt, Sarah Davis, Jacqueline Hernandez, Lauren Peters VOTE RESULTS TABLE SANFILIPPO JOHN B & SON INC (JBSS) common directors: Pamela Forbes Lieberman 43% NO; Mercedes Romero 51% NO; Ellen C. Taaffe 44% NO “The Board of Directors recommends a FOR vote for Pamela Forbes Lieberman, Mercedes Romero and Ellen C. Taaffe” Common stock holders: BlackRock/Thrivent Financial for Lutherans/Vanguard Group combined 33.6% class A directors (5 Sanfilippo and 2 Valentine) 100% YES 10 votes per share Sanfilippo/Valentine hold combined 74% voting power and 100% of Class A shares “Gender and Diversity: Common Stock Director nominees are all female. Together with the Common Stock Directors, 40% of our Board is female” 1 of 7 Sanfilippo/Valentines is a woman Stock was $125 in 2023, currently $68 James River Group Holdings, Ltd. (JRVR) 99% avg YES 37% NO Pay 3% NO last year CEO: $11k less in 2024 (from $2.72M to 2.71M) Other 4 NEOs got total cash retention award of `$1.9M, but the decision was made in last year’s proxy SOCIETY PASS INCORPORATED. (SOPA) Loic Gautier 99% NO; After the Annual Meeting, Loic Gautier resigned all other directors 99% yes Only thing different about Luic in proxy: “Non-independent Director” Vote was October 21: After the Annual Meeting, Loic Gautier resigned as a director of the Company, effective immediately. Loic Gautier’s resignation was not as a result of any disagreement with the Board or the Company. On October 24, 2025, Society Pass Incorporated announced the resignation of Loic Gautier from its Board of Directors, effective immediately. The resignation was not due to any disagreement with the Board or the Company. VALUE LINE INC (VALU): Stephen P. Davis: 95% NO Seems to still be on board: “Each candidate shall be elected by a plurality of the votes cast” Retired Deputy Commissioner, New York City Police Department 99% YES last year “On October 7, 2025, Value Line, Inc. held its annual shareholders meeting to elect directors. The voting results, as reported by American Stock Transfer & Trust Company, LLC, confirmed the election of several directors, with Howard A. Brecher, Mary Bernstein, and Glenn J. Muenzer receiving significant support, while Stephen P. Davis received notably fewer votes in favor.” Next lowest was 3% NO Mawson Infrastructure Group Inc. (MIGI): 62% NO all 3 directors: Ryan Costello, Steven Soles and Kathryn Yingling Schellenger were elected, by a plurality of the votes cast Stock was $99 in 2022, currently $0.95 Innovative Eyewear Inc (LUCY, LUCYW): voted not to reinstate the voting rights acquired by Vladimir Galkin, Angelica Galkin, and the Galkin Revocable Trust: 76% NO Recorded 72 meetings since October 8th: TWO SHPs CINTAS CORP (CTAS) call for a special shareholder meeting 45% YES PROCTER & GAMBLE Co (PG) plastic packaging 14% YES THE BIG VOTE PICKS DAMION Upcoming Meetings November 10- AGM Date Company SHPs # Notes 11/11/25 IDT Corp 0 11/12/25 Jack Henry & Associates 1 Call special meeting 11/12/25 Viavi Solutions 0 11/12/25 Adtalem Global Education 0 11/12/25 Extreme Networks 0 11/12/25 BGC Group 0 11/12/25 Automatic Data Processing 0 11/13/25 Estee Lauder 0 11/13/25 Axos Financial 0 11/13/25 Coherent Corp 0 11/13/25 Broadridge Financial Solutions 0 11/13/25 Tapestry 0 11/14/25 Fox Corporation 2 Improve executive compensation program AND simple majority vote 11/14/25 Sysco 1 Separate CEO/Chair Matt ZOMBIES Directors with <50% FOR votes in 2024 who stayed on the board anyway Because the undead can’t be killed 2024 Update: Building a multi year zombie board Investors voted OUT directors at AO Smith and Boston Beer Company in 2024, both of which kept their directors, but as classified boards now they just have DIFFERENT directors voted out AO Smith’s Michael Larsen, 39.6% FOR Boston Beer’s Meghan Joyce 49.7% FOR 2025: Which boards have the highest zombie influence? 22 zombies in the US - 26 global when you count 4 in Puerto Rico Almost all are either classified boards, plurality voting, or have some other strange control mechanism - only two big ones really worth mentioning Netflix Jay Hoag, 21.5% FOR, 6% influence Second time he’s been voted out this decade On June 22, 2025, the Board rejected Mr. Hoag’s resignation. The Board, consistent with the Nominating and Governance Committee’s recommendation, determined that Mr. Hoag’s continued service as a member of the Board is in the best interests of the Company and its stockholders We believe that Mr. Hoag did not receive a majority of votes cast in his election to the Board because he attended less than 75% of the meetings of his total board and committee meetings in 2024. Upon the recommendation of the Nominating and Governance Committee to reject Mr. Hoag’s offer of resignation, the Board determined that his absences in 2024 did not indicate a lack of commitment to his duties, noting that Mr. Hoag possesses an otherwise exemplary attendance record Tripadvisor Greg Maffei, 30.7%, 9% influence Jeremy Phillips, 43.2%, 5% influence Through the magic of plurality voting, all you need is ONE vote and you’re in! Congrats to Maffei and Phillips who investors hate but can’t get rid of! Fun fact: in the 2024 vote, you’ll never guess who was on the board - Netflix zombie Jay Hoag! KRAKENS Current directors with the most discrete 2nd degree connections in our database to other current directors US director only for this This year includes non profit connections, now Krakens have even longer tentacles TOP DIRECTORS: Patricia Russo Actively connected to 29 other current directors in first or second degrees Boards of… GM Merck HP KKR Mark Weinberger 25 connections Boards of… J&J JPM Metlife Alex Gorsky 22 connections Boards of… Apple IBM JPM Most over the top Kraken duos Pat Russo (29) and Wes Bush (20), both on the GM board Connected via 5 different paths through - Just Capital Foundation, Business Roundtable, Northrop Grumman, Greater Washington Partnership, Merck, and KKR Mark Weinberger sits between them in two of their paths Alex Gorsky (22) and Mark Weinberger (25), both on JPM board Business Roundtable and J&J, where Gorsky was CEO, are throughputs Corporate Krakens Companies with directors who have the most discrete tentacles - ignoring the Dolans/MSG because it’s all controlled and they sit on dozens of boards together IBM - 125 total tentacles GM - 125 tentacles JPM - 112 tentacles Merck - 110 Chevron - 103 DOW - 97 Northrop - 93 Target - 92 MUMMIES Directors that aren’t family, founder, insider, CEO, controlling shareholder, or executives with tenure >20 years and less than 10% influence in the US Just wrap them up and put them in the corner There are 255 of them actively on boards 35 of them are lead “independent” directors! Just absorb that - these are directors with less than 10% influence, no founder/family/control problem, been there more than 20 YEARS, and still are pointless! MORE THAN 10% OF MUMMIES ARE LEAD DIRECTORS! Here are my top 5 favorite mummies that investors keep covering in desiccant year after year with FOR votes: Steve Odland, General Mills, 2% influence CEO of the conference board who put out pieces about governance regularly, including on the “pressures of directors on succession planning” and how “nearly all senior executives are calling for board refreshment” Steve… is the irony not, like… a LITTLE obvious for a guy who’s been on the board of General Mills since the year the iPod Mini was launched? (21 year tenure) Simon Lorne, Teledyne, 3.8% influence 79 years old, he joined the board the year Victor Wembanyama was born (21 years ago) Ex Munger Tolles lawyer Bill Grabe, Gartner, 8% influence 86 years old!, on the board since the same year Kurt Cobain married Courtney Love (32 years ago) Ex IBM, chairs the Nom committee - which explains why the average tenure of directors at Gartner is 13 years - with five directors out of 11 at 15 or more years When Steve Pagliuca joined the board 15 years ago, Grabe was 71 years young Gartner is an expert network currently pushing AI expertise… from… an 86 year old… Bill Miller, Cummins, 9.9% influence 68 years old, on the board since the same year Bill & Ted’s Excellent Adventure was released (36 years) - and he definitely saw it, he was 32 at the time Chairs Comp committee President of the Wallace Foundation since 2011, previously on boards of mutual funds Shouldn’t we NOT store our mummies in the comp committee? VAMPIRES Directors that perform under .250 for both earnings AND TSR with greater than 10 year tenure and over 75 years old Ancient AND blood sucking We lost some vampires last year to retirement and/or mergers, but don’t worry, we have 6 this year with only ONE repeat - here’s the top three: Colm Barrington, 79 year old director at Willis Lease (US) and Fly Leasing (Ireland) Wolfgang Porsche at VW and Porsche - the 82 year old has 20% influence and bats in the bottom quartile for both TSR and earnings - and the company is named after him Po Chu U repeats - 99 year old woman who is dictator at Lai Sun Development in HK, her son is also on the board I can’t be mad at a 99 year old woman, even if they provide no shareholder value and suck the blood out of their company FRANKENSTEIN Directors with <50% FOR votes in 2023, stayed on the board as a zombie, and got >50% FOR votes in 2024 Every good zombie movie ends with the zombies winning? TG Therapeutics had 3 directors fail the vote last year to pass this year: Daniel Hume: 58.9% FOR Sagar Lonial: 54.1% FOR Yann Echelard: 58.6% FOR But my favorite this year…Veeva Systems’s Paul Sekhri 2024 vote: 48.8% FOR - voted OUT “Mr. Sekhri tendered his conditional resignation as a director for consideration by the Nominating and Governance Committee (the “Committee”) of the Board of Directors of Veeva (the “Board”) and for the ultimate decision of the Board. The disinterested members of the Committee recommended, after due consideration, that the Board should not accept Mr. Sekhri’s tendered resignation.” 2025 vote: 94% FOR - everyone loves that guy! That’s the Proxy Countdown for the week of November 3, 2025. Join us next week when we jump back into the Alternative Democracy pool... forever on the lookout for shareholder shenanigans, dopey directors, scandalous CEO pay ratios, and wayward BandAids

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Founder boards, plus Zaslav’s payday, and the death of shareholder proposals

PROXY COUNTDOWN

49 minutes 13 seconds

5 months ago

Founder boards, plus Zaslav’s payday, and the death of shareholder proposals

Trade Wire - BUY/SELL Top Stories: The money In response to angry shareholders: Two weeks after 60% of Warner Bros. Discovery shareholders rejected CEO David Zaslav’s $52M pay plan, the Compensation Committee restructured his plan using Hollywood’s latest CGI, special effects, and most seasoned stunt doubles: his new plan reduces his annual pay targets significantly–from $37M to $17M if he hits 100% of his targets–but the devil is in the details as he is eligible for $37M if he reaches 200% of his targets and is getting a massive option grant of 21 million shares at an extremely low strike price of around $10 per share, giving him the theoretical opportunity to make $1.4B if Warner Brothers’ share price regains its 2021 high of $77. To walk in the door: Ciena Corporation’s new CFO Marc D. Graff will get $2M in cash and $10.5M in time-vesting equity. While Arista Networks’ new COO Todd Nightingale is welcomed with $32M in equity, $30M of which vest simply over time without any performance-based conditions: an amount which is 92 times greater than his base salary. Boeing’s longest-tenured director Lynn Good joins the Board of Morgan Stanley just two days after the crash of a Boeing 787 Dreamliner in India killed more than 200 people. Yum! Brands CFO Christopher Turner has been promoted to CEO to replace David Gibbs. In doing so, the company skipped right over Chief Operating Officer and Chief People & Culture Officer Tracy Skeans who has been at the company 20 years longer than Chris and in her dual roles oversees two key industry areas of risk in customer experience and labor management. Maybe we have Yum! Brands Chair Brian Cornell to thank for this decision? As CEO of Target Brian has overseen the company’s recent demise due partially to customer-alienating decisions surrounding the lack of support for Gay Pride and the sudden abandonment of the company’s DEI policies due to the perceived threats from a US election. At Yum Brands’ annual meeting last month Chair Cornell received 17% votes against his reelection, more than 3 times greater than any other director. Continuing to follow the trend of large cap companies with only 2 women on the board: Thomas Frist, III is stepping down at VeriSign, a board with only two women. Will they take this opportunity to replace him with a woman? Same thing at Nutanix where Brian Stevens just stepped down on a board with only two women And at Live Nation Entertainment where Greg Maffei’s 33% influence just left the board. Affirm Holdings, however, is keeping the board at two women ignore the problem by replacing retiring director Keith Rabois with Richard Galanti, keeping its board below the accepted minimum threshold of three women on the board. And finally, Pitney Bowes has cleverly circumnavigated shareholder approval as it appointed Brent Rosenthal to its Board only a month after its annual meeting in May. PROXY CAGE MATCH Activist investor , which owns about 1% of Victoria’s Secret, is arguing that the company has failed to realize its potential since its separation from its parent company, L Brands, in 2021. Specifically, CEO Hillary Super “has limited chief executive and public company experience with only a brief tenure in intimate apparel.” CEO Hillary Super (September 2024-) CEO, Savage X Fenty, intimates retailer, 2023 – 2024 CEO, Anthropologie Group, 2020 – 2021 Global President, Anthropologie Group, 2019 – 2020 Co-President, Anthropologie Group, 2018 – 2019 President of Women Apparel, Accessories, Beauty and Bridal, Anthropologie Group, 2017 – 2018 Six directors sat on the board during the company's decline and the remaining two independent directors "have limited experience successfully scaling global consumer businesses … We believe that Victoria’s Secret requires a reconstituted Board comprised of directors with proven experience in brand revitalization, operational execution, international expansion, and shareholder value creation … “ [the retailer] should consider replacing a majority – if not all – of the Board with independent directors who bring relevant backgrounds, fresh perspectives, and a strong track record of value creation." 8F/2M Chair Donna James, (2021-); (L Brands: the former parent company of VS&Co, 2003 – 2021) Chairman George Mayes was voted out and then resigned at Forward Air’s annual shareholder meeting last week. Directors Javier Polit and Laurie Tucker have also stepped down despite receiving a majority vote. The Board has appointed Jerome Lorrain as Executive Chair and Paul Svindland as Lead Independent Director. Ancora Holdings, which owns a 4.1% stake, previously said the three “unfit legacy directors” cannot be trusted based on their “history of inaction, failed oversight and highly problematic decisions,” blaming them for the company’s decision to pursue the Omni Logistics acquisition in August 2023. VOTE RESULTS TABLE Here are the highlights from 45 large-cap annual meetings over the past week: 30 total SHPs: but from only 13 companies, meaning 32 meetings had zero SHPs Nearly half (13) came from Alphabet only 3 on G 4 on AI equal shareholder voting 31% YES (highest YES vote) A stockholder proposal presented at the 2025 Annual Meeting but not included in the 2025 Proxy Statement regarding a report on implementing AI app preload capabilities into Android OS 0.000273% YES (lowest) 342|12,515,614,679|1 27 of 45: zero shareholder proposals and zero shareholder dissent. Only 2 wins overall: Fidelity National Financial: elect each director annually 93% YES MONOLITHIC POWER SYSTEMS: call a special shareholder meeting 58% YES 7 “moral” victories (over 30%): Alphabet: equal shareholder voting 31% YES 96.1% of Class B shares (10 votes) held by Larry Page/Sergey Brin/Eric Schmidt/John Doerr=57.3% voting power; 73% on non-class B voted YES Marvell Technology: Independent Board Chairman 38% YES CORPAY: independent Board chair 39% YES Fortinet: require that two separate individuals hold the office of Chairman of the Board of Directors and the office of the Chief Executive Officer 42% YES Fidelity National Financial: (MGMT Prop) redomestication of the Company from the State of Delaware to the State of Nevada 34% NO Chipotle Mexican Grill: 45% NO on Pay “One-time retention awards” on August 2024 after Brian Niccols left: $38M aggregate to NEOs CORPAY: 47% NO on Pay The shareholder disconnects: Chipotle Mexican Grill: lowest director 4% NO Fili-Krushel & 45% NO on Pay Target: lowest Cornell 9% NO and Stockton 5% NO The shareholder connects? Marvell Technology: Independent Board Chairman 38% YES CORPAY: independent Board chair 39% YES Fortinet: require that two separate individuals hold the office of Chairman of the Board of Directors and the office of the Chief Executive Officer 42% YES The directors : 5 over 20% Regeneron Pharmaceuticals: Brown 27% NO (classified) Natera: Gail Marcus 29% NO; Roy Baynes 19% NO (classified) Pure Storage: 64% NO Scott Dietzen; 21% NO Charles Giancarlo; John Murphy & Greg Tomb 18% NO (classified) Dietzen Vice Chairman and Former CEO (2010-2017) and on Nomination and Risk Committees; referred to as "Independent" CORPAY: Joseph W. Farrelly 26% NO Alphabet: Larry Page 19% NO (44% NO) Page/Brin 52% Voting Power The oddities: The oddities: THE BIG VOTE PICKS MATT NVIDIA Founder firm, top of its game, on any given day largest company in the world at 3.5tn cap - with no governance of its founder Could Nvidia be the next Tesla? Similarities: AI meme wave - trades at a 40-50 P/E ratio, which was a 140 P/E (Tesla traded at 40-50x before they started losing money, now at a 180) Deeply entrenched boards (more on that) Deeply oversized pay packages Stanford Both immigrants Deep relationship WITH Musk Outsized, leather jacket wearing CEOs Kissed Trump’s ass about tariffs From 2018: US chipmaker Nvidia's founder and Chief Executive Jensen Huang said curbing China's technological development could not be achieved by adopting heavy tariffs. From May: “Obviously, I don’t know all of his ideas, but let me tell you about two that are incredible,” answered Huang. "The first one is utterly visionary. The idea of tariffs being a pillar of a bold vision to re-industrialize to onshore manufacturing and motivate the world to invest in the United States is just an incredible vision.” Deep dive into founder boards - who do we hire to work with outsized, unique, long-term founders Defining “Founder boards” 152 US founder firms that IPOed 10+ years ago “Mature” public founder firms Not controlled companies - 1 share, 1 vote or no majority shareholder Includes Nvidia, Amazon, Tesla, not Meta, Berkshire, Oracle, Nike 1,395 US non controlled, non founder firms (the control group) Findings Surprising things that are the same between founder boards and non founder boards Same percentage of VCs on the boards on average - speaks to the importance of private markets No age differences on average No gender gap difference on average after adjusting for founder and CEO power - this surprised me When you include founder power on boards, it definitely skews to much larger gender power gaps, but adjusted shows that if NOT for the founder, you’d have near parity In fact, in the control cohort, the power gaps are better as soon as you exclude CEOs, too - the fact that men hold the vast majority of the top positions everywhere is THE LARGEST difference in power gaps on boards Solution: no CEOs on boards, you’ll have better power parity Biggest differences Founder boards skew long tenured - 15% of founder boards have more than 15 years tenure, compared to 12% of the control VCs stick around longer - 46% of VCs on the board stay more than 10 years vs. 36% for control VCs in general have longer tenure Founder boards tend to underperform on earnings, outperform on TSR Founder boards rely LESS on connections to one another - it’s only the connection to the founder that matters Summary thoughts Boards operate in one of two ways: fetishize the most powerful person in the room (founder, CEO) OR as a social club (high degree of interconnectedness) Nvidia needs governance now, not later… Nvidia is an outlier - nearly 60% of the board is long tenured, with 33% of board more than 15 year tenures - only other company this bad is Netflix at mega caps - all of which were original investor VCs Tench Coxe - like Robyn Denholm - has not only been around for 30 years, his shareholdings have made him a billionaire from just this company Harvey Jones and Brooke Seawell haven’t just been at Nvidia for more than 30 years EACH - they worked together at Synopsis in the 1990s Of the 13 directors, 8 have been on the board at least 10 years - the average tenure of the Nvidia board is 13 years, and 62% of it wouldn’t be considered independent in the UK If our advice at Netflix was to break up the lack of independence - and investors have rewarded Netflix with a lower average vote for directors than peers (94% vs. 96% average), and the longest tenured directors get 90% routinely over the last decade Just on its face, who makes decisions: Ex head of marketing for NFL and former food executive (Dawn Hudson) Ex 31 year Taco Bell executive (Melissa Lora) Two professors (John Dabiri, Persis Drell) Ex NASA engineer (Ellen Ochoa) Lawyer (Stephen Neal) Ex CIO of a drug company (Aarti Shah) FIVE 1990s/00s tech and VC bros - all bros - Rob Burgess, Tench Coxe, Harvey Jones, Brooke Seawell, Mark Stevens - most of whom have been with Jensen Huang for 30 years This is easy - break up the 90s tech VC fraternity block: Vote out Brooke Sewell Vote out Harvey Jones Vote out Tench Coxe

PROXY COUNTDOWN