CEOs In The Crosshairs As Proxy Season Heats Up

As proxy season hits, Barron’s has a look at seven big-company showdowns, including Boeing, Allergan, GE, Facebook and Amazon. If you didn’t see it, the piece is useful for investors, but even more instructive for CEOs and directors looking to suss out some of the big themes that are potentially emerging this year.

One big takeaway: public-company CEOs are in the crosshairs. Again. And while these proxy pushes may not amount to much, they’re worth paying attention to as the nation heads into election season.

Concentration at the top is one big theme. At Boeing, where the recent 737 Max fiasco—and subsequent sell-off—gave ISS and Glass Lewis the ammo to try—and fail—to have CEO and Chairman Dennis Muilenburg surrender the chairman role.  The theory, of course, was that by dividing the office, you’ll have better oversight of the company.

Muilenburg surviving the attack won’t hinder other, similar efforts elsewhere. At Facebook, where CEO, Chairman, Founder and—thanks to the company’s dual-class share structure—lord supreme Mark Zuckerberg has unfettered control over the company. As Barron’s reports, Trillium Asset Management sent a letter to Facebook, pushing for a independent board chair, citing other tech giants including Alphabet, Apple, eBay and Microsoft as examples.

At Allergan, CEO and Chairman Brent Saunders faces activist Appaloosa Management, who are pushing for a split after shares underperformed expectations. Saunders, Barron’s reports, is resisting, and making it a referendum on his tenure. Interestingly, both ISS and Glass Lewis came out in support of the CEO, so he may survive the vote.

Also worth watching: CEO pay. Last year, amid a booming stock market, the first required disclosure of CEO pay ratios passed by without much notice. But this time around, , as the 2020 election cycle heats up, with democrat candidates like Elizabeth Warren calling for rough justice in the C-Suite, there seems to be increasing scrutiny of what those in the corner office are taking home.

Disney’s Bob Iger was the first to get whacked, with a very public dressing down from a Disney heir over his pay (though Iger, it should be noted, is often a lightning rod. Last year he need to dial back his comp to get it approved.)

This year, expect GE CEO Larry Culp, with a CEO-to-median-pay ratio of 345:1 to draw some ire, says Barron’s, as well as Mattel’s CEO Ynon Kreiz. No surprise there. Kreiz clocks in with a pay package 3,408 times what the average worker at the toymaker. As we head into the democratic primaries, angry shareholders could be the least of his PR worries.

Read more: Sorry, Bernie: New Study Shows Inconvenient Truth About CEO Pay