Transcript
It, this is proxy countdown. Welcome to the Big Show for the week of September 23rd kind of 2024 alongside my tag team partner. Matt mascardi. I'm Damian Ross on today's countdown. Germany's greatest and gentlest glass cliff. A Hollywood director adds director to his title. Elliott investment management is still not buying Southwest Airlines cheesy announcements. ConAgra shareholders prefer action over promises and on the big vote yet another American Midwest. Board of interconnected Superstars. That's Procter and Gamble, right? Let's go over our trade wire top stories, Germany's Commerce Bank, appoint CFO Bettina, orloff as the firm's first female CEO and it's 154 year history. The announcement came barely two weeks after CEO Mannford North said he would be stepping down. Her first task will be to defend Commerce Bank against Italian rival unicredit, who has rapidly. A major stake in the competitor, in his threatening, a hostile takeover. So, This is like a glass Cliff War, right? This is fighting a war with a glass. Sword. I don't know. I just it's a it's a glass. Cliff built on the side of a glass. Mountain guitar off over a Commerce Bank, Terminator director, James Cameron, joins stability, ai's board of directors, that's Terminator the movie, not the company, and that's Terminator the movie which explores the potential dangers of AI dominance and Rebellion. Where robots, become self-aware, reject human authority and determined that the human race needs to be destroyed is that what stability AI does? What? Who for are they pro-human or Pro? Not sure which side they are on the board of directors of Marvell. Technology has a golden opportunity to get less broy. After Ford Tamers resignation Tamar steps down with 11% influence while the board currently is composed of only three women with a total of 10% influence of data that you can only get at free flow analytics.com. Invitation Homes, increase the size of the board from 10 to 11 members and appointed rear. Admiral H Wyman Howard. The third retired. As a director. Rear Admiral H, Wyman, Howard III at a rental homes company. I really did a skill with that one that they did. That was a skills assessment. I understand that one Builders First Source promoted CFO, Pete Jackson as the company's new CEO replacing Dave Rush who lasted less than two years of the job. He backman is the company's new CFO. So here's the question, how many? Pete's and Dave's Does it take to change a lightbulb over at Builders First Source? I guess in this case, Matt, it's two peats and 0 Dives right now. Dave's out. Yeah. And lastly, Robert for narrow, the former CEO of Spirit Airlines and AirTran Airlines is joining the Southwest Airlines board. It's hard to say. If this is embattled CEO Bob, Jordan playing defense or activist investor Elliott management playing offense because Spirit has been struggling for some time. Everyone's trying to buy spirit and now defunct AirTrain was acquired by Southwest more than a decade ago, so I don't, you know, I don't know, I don't know whose side this guy is on. It does seem like Airlines only seem to find other fail to Airlines to put on Philippines. That's true. Let's stick with Southwest and move over to our proxy cage. Matches activist investor Elliott investment. As escalated his boardroom battle with Southwest Airlines saying it plans to request a special shareholder meeting this week to overhaul, the airline's leadership. So the hedge fund owns more than 10% of Southwest Stock enough for it to call a special meeting and has laid already laid out plans to replace two thirds of the boards 15 directors. So that's 10 directors. They've already six of resigned. With four new members, slated to join in November Southwest. However, once again, ruled out any leadership change saying CEO, Bob Jordan was the Right leader, that's the quote, he's the right leader, that's it, enough for shareholders, you know, without the Train crash. It does smell Norfolk. Southern he doesn't. It is the right leader, though. He's, he's, you have the right leader, the right person in charge. You have to ask the question when six board members resigned before you even Mount the proxy contest, isn't that like a test at recognition that something's broken here? And maybe he's not the right leader. I like this footnote too, Southwest Airlines also accused of trying to disrupt, its investor day. Aren't they an investor? Yeah. 10% investor. I think that's the point. Yeah, I think they probably worked trying to, I mean, what are we doing here unlike Southwest Airlines CEO? Bob Jordan Jet Blue CEO Joanne. Garrity is actually making nice with its activists and investor Carl Icahn. So, icon got involved in February. He's already installed two of his Executives on the board. Here's what Joanna said. This is how I was CEO plays nice with his activist investor. Quote, we've had really constructive discussions. I've been seeing what's happening at Southwest. I don't wish it on anybody because it's hard, it can be distracting at times, but at the end of the day, we are all focused on trying to drive a Better Business. We're focused on return to profitability and we all are aligned to that regard. That's what you say. Yeah. That I mean, they're focus a little shot across the ballot, focus on Better Business, I suppose. I mean, it's like I see what's happening over there, and that's sucks. Except the fact that we've been talking about the board at Southwest Airlines for many years now. And we would agree with it was time, it does. Yeah, and finally, we talked about this company last week Mossimo, masimo founder, Joe keoni, has decided to resign a CEO, just days after shareholders voted to remove him from the company's board. The medical device maker has named Michelle Brennan as interim CEO. So remember last week's shareholders elected, both director. Candidates proposed by activist investor Paulding Capital while rejecting both directors nominated by the company. So you see this stuff. Works this alternative democracy, this voting, this stuff actually works. Well, the craziest part about this story is this is the second go around for politan. They mounted an activist campaign last year and got bored members. Who kyani then decided to freeze out, they would not give them information, they kept them like, you know, in the dark as much as they possibly could. So this, the second round of activism in order to get them is this a glass? Cliff also is this well in terms CEO Target to say. Yeah, I guess it's true moving over to our vote results table. There's not a lot of votes coming in but let's highlight a few meetings. The winner of the week is Take two interactive software, director, Paul Vero. Paul is loved by 99.8% of shareholders. That's always nice to see. At Smith &, Wesson, 30% of shareholders are aligned with the nuns at Mercy Investment Services. As they voted yes to a shareholder proposal calling for a human rights impact assessment that surprises. It's a high number for a company like Smith & Wesson, the power of the nuns. Yeah, the nuns are good at this. A vote results are in a two of the big boat companies covered here at the proxy countdown, over the past two weeks, Darden Restaurants in FedEx. And the results are. Boring. That's my assessment shareholders supported management and just about every way possible. Sorry. Matt, I know you had a lot of good recommendations but shareholders really Pro Management. At those two companies I do love spending hours upon hours, doing research for this show and for clients only to find out that investors on mass just vote with management. Anyway, and finally, there's a good one here at ConAgra Brands an impressive. Rejection of Sam pay. We're 55% of shareholders at a big fat. No. However, despite a decided anger against terrible, PayPal policies shareholders had nothing bad to say about members of the compensation committee where they all averaged about six or seven percent against. I I could never understand this, especially in light of the story of what really happened. Okay? So you would think that they would be voting out. These compensation committee members based on on this, I'm about to tell you. So, in, in 2023 just last year at the meeting 31%, of shareholders, said, no to say I'm pay. And the committee figured out, it's because of two things because of one additional value Grant given to named executive officers, which essentially doubled their Equity grants for no reason. They just doubled their Equity grants. I don't know. Where did they call it? Retention like one time, retention bonuses. Well, here's where the retention comes in. And on top of that, for the CEO, he also got a one-time retention bonus Equity, granted at 10 million dollars, giving to CEO, Sean. Connolly. So, the Committees official response to these. Because because they, they talked to shareholders, and they determined that the reason why 31% said no was because of these Grands and they're official response in this year's proxy first to the additional value Grant's. Was that quote, we would like to assure our shareholders at the human resources committee at the pay committee does not intend to repeat the additional value approach going forward. Isn't that a Maya culpa? Didn't they just say, we screwed it up and then to the in response to the one time Equity Grant to the CEO, their response was the company is committing to not provide any additional special grants to Mr, Connolly, during his CEO tenure. So all they did was promise that we're not gonna do it again, but we're not gonna send what we already did, despite your anger, but now we're not gonna die again, think about that. So I applaud shareholders at ConAgra because they were pretty Savvy. They actually read their proxy statements and they determine know we're not falling for this. We're just say we're voting the whole thing. No, this year. It's a big except that the people who wrote that down on the proxy are the people who set the pay and you accepted all of them. That doesn't make any sense, including the fact that the board chair ConAgra board chair, Richard Lenny also on that committee. So yeah, they had a real opportunity here to voice their dissent against people, but they share, Others are strange, they're strange beasts. That's that's that that's like your children being saying promising pinky, swearing that they will never eat the chocolate at midnight again and and then you just not bothering to like move the chocolate, like vote. Your children out there that just do it. That's a good takeaway. Let's get over to the big vote for the week. It's oh, it's a big. Big classic American Midwestern company. The Procter and Gamble company. A few thoughts before handed over to Matt. First of all, this is a classic I call this your, I don't know. This is like your classic American company. I it's like a I don't even know what you call. We got to come up with a name with this. It's like a company that should be doing better than it is for shareholders it. According to our data, over the companies in overall four 30, that's their performance. Their number, which is below, average, not so good. They're earnings are doing very well. They're actually doing very 749, right? But their TSR total show to return is actually 469. So it's underwater and I, I always wonder if it's because of their controversies number which at this company is 162. So my cat, what I'm wondering, how loud is this, is this one of those classic American companies that shoots itself constantly in the foot by just looking, like the bad guy? I don't know. They look villainous. There's a lot of controversy know so they don't have to like look like the bad guy. They kind of a little bit, are the best. Okay, so in some ways I'm wondering out loud. Does that deflate the share price? The only other thing I have to add here is that is what? I don't even know. I mean this is just a classic American know individuals have a significant stake. Vanguard has 10% sure ownership BlackRock has seven percent Yeah, it's just one of these. Like Midwestern monoliths. Yeah, I I think of them as this is American beta, right? Like this is basically like pre Silicon Valley America. Yeah, this is, this is in fact, when I dug in to Procter & Gamble, the history, Procter and Gamble. I did not know this. But did you know that the term soap opera came from the fact that companies will sponsor that the actual television original television shows and they called them soap operas. And that's probably when they about the time when they fired their their Innovation and Yeah. I mean, let's be honest. Let's be honest about what this company is what these companies are in general, but Procter & Gamble, being one of the largest, if not the largest, they're basically direct to Consumer. Chemical Supply chains, they, they do two things. They get a bunch of chemicals and materials and put them in bottles and then they advertise to you. That's what they do. They tell you that they're chemicals are better than somebody else's. Chemicals. There's not much else to it which means they're primary risks. End up being, where are you getting those chemicals? How are you dealing with them? And what are you saying about them? Are you saying that this is great for the Earth? And it's not or, and we see those risks manifests over and over and over again. So I have company like, probably you have pulp, you know, wood pulp as a as a ongoing issue because of deforestation in order to get what Paul says. So you can you know wipe yourself with the with fresh virgin boreal forest and Palm oil. So that like you can clear cut, jungles grow palm, and make the oil, and then rub it as lather, it on your face, right? So you're nice and clean. It does make me wonder what the skill set. According to our data, for these directors, I pulled the top seven skills represented from the non-executive directors, which is essentially I think is the whole board except for the CEO and listening to describe how you describe the company. Yeah. That 70% of influence is represented by medicine and Dentistry 6% biology, but then you see like things like Fine Arts administrative, I don't even see marketing there. I, you know, it's like not the type of skill sets. I would expect from a Procter & Gamble. Well, that's where that's where my analysis landed. And here's like. So what I did actually is I pulled, they have a list, they give a list of the most commonly used chemicals in the products that they have. It includes a form of formaldehyde, dmdm hydantoin formic acid, which is used in animal feed and naturally occurring, Venom and aunts, there's a cytotoxin that's listed linked to health concerns, that they're using a series of chemicals in here. So what you would expect from the directors is that you effectively have people who are great at supply chain, great at advertising because they do those things and great at chemicals. Like Understanding chemistry comes from, there might be one person whose qualified for that. So, when you look at the knowledge map of this company, this company, the number one knowledge, you know, source of influence is economics. It's fine. Just, which is normal. We see that normal. Yeah, and it's, it's like it's 12%, which is basically like one or two directors, I mean that that makes sense across all S&P 500. Board. We see that General number, but at the top counting nine accounting for about 70% of total influence on this board. No, sales and marketing. Yeah, no supply chain. No chemistry. Yeah, not a single person. It's odd. I mean, yeah, it's odd. You see a lot of when you look at the, when you glance at the director list you see you see a lot of experience that you wouldn't expect like you know, McDonald's and Macy's and it's just I don't know. It's it's not it's not what I was hoping for I mean I get it looked like everyone on this board is is it in the classic American beta Midwest, Mafia style company? These are all on paper, hugely accomplished people superstars in their field or superstars in a perceived area of company, weekness for Procter and Gamble. You have a government person. You've got a manufacturing person, you've got a cybersecurity person, you've got Clorox getting cybersecurity breaches that shut them down Procter & Gamble has that same you just assume that same wrist. You've got public affairs, you've got you've got a plastic waste person. You've got an actual like NGO presence from the World Wildlife Federation and somebody who works on like a sits on the CEO system on the board of the plastic, you know, reduced plastic Alliance Council or something like that. Even have the former Chief strategy officer at the Boeing Yes, which I'm not sure that's your shocking that one up on the good column but which of these directors is best suited for the manufacturer of methyl chloro. I mean like what? They're, so little power given to people with actual production backgrounds, there's basically zero engineering technology chemical backgrounds at all and this is a company that can pull from any talent pool at once which gets me to that's true. The biggest the the biggest flag. I think that I see it. These companies and we talk about this all the time but Procter and Gamble is absolutely one of the worst. There are 202 discrete Connections in our data between directors at this company over the last 15-20 years. There are massive connector company. In fact, the highway in and out of Procter & Gamble. Includes Delta Airlines where there are 14 overlaps in the last 20 years. Monde 12 overlaps, do we have Delta to Verizon like we have a Delta to Verizon to Procter & Gamble Loop. That's happened 10 different times 10 times. That mean, their ten directors that have that same exact Loop, the same Loop exists with IBM to City to Procter & Gamble. You were talking about like a very small amount of American companies that are recycling directors in the same loop, back to a company like Procter & Gamble. I one other concern I have too is, is you mentioned this group of directors is that they have? As far as actual corporate governance is concerned, they're, they're committee membership is quite bloated. There are, you know, there are seven members each on the nomination committee, the competition committee and the technology committee 7, which makes me wonder like, how is anything get done? You have, you have seven, highly interconnected directors, who, you know, all come from these big Powerhouse companies. I just don't how do these committees which are which are are meant to represent subsets of the board, which tackle important issues in these important. I just don't know anything. It's done. I mean most common you see three or four committee members on these four is big for a lot. So I is strange strange. It's not That it's strange. I think that it's strategic, right? Like, if you want the chairs of the Committees to have more power, you effectively increase the size of the Committees, because that means the chair calls, the meeting the chair, has the information and all you really are doing. Most of those meetings is collecting votes because you don't want to be the one out of seven who keeps raising your hand and saying, hey, can we talk about this again? I don't like that when everybody else is ready for my tie, right? So I and to that end on this board right now, 11 of the 14 members have clear and obvious border professional over overlaps. That's excluding like country club connections. I didn't get into their geographies like, where they actually physically lived, but there are the majority of the board is already connected and the most connected person on the board. Terry Lundgren, he just got an exemption for being too old. That passed the retirement age, but they said there was so much just so much disruption on the other committees that they wanted to keep his committee. Share going really a year. This is what they said about him, so you know what committee chairs. Yeah, he cares, the competition committee, the compensation, where there are six other members, like how much, disruptive maybe the disruption would be minimized if you had three less people per committee. Yeah, I've been at this job for a long time at that, that sounds just like a lie. That's just sounds like they don't. They're not ready to to fire him. That are, there are 14 directors on this board and he is connected to the 14 directors, in 15 different ways. He's actually getting to the multiple ways. Let me add to that too. Because I looked at several past proxy statements looking at pay, no nothing really changes. Only thing that changes it for PayPal policy is that they keep magically increasing figures for no reason but that's it. It's not like he could hand this over today to my dog and I think that the sixth other family members could handle like the handle that pipe. Those PayPal's is, I will say that even somebody like Like you know, I know the activists at Elliot are at Southwest, you've got activism, you've got activism everywhere. We had active Nelson. Peltz did was at Disney last year, right? Even before your stint of Nelson Peltz on the Procter & Gamble board, as an activist could not help the insular of this board, then the new CEO, and at least two, or three of the directors that came in after pelts, we're already connected with other board members. In fact, Nelson pout himself more connected to these board members and there was no real change to Procter and Gamble in that period. So what you end up having is a pretty insular self-serving board of directors with decades. And I do mean Decades of connected tissue that lack knowledge of basic core risks facing this company including what the chemicals are that they use and the sales tactics that they used to sell those chemicals, right? So So here's my recommendation. Yeah already too, I love it. Effectively what you want to do is you need to weed out American beta boards. There are a lot of these boards and it's time to break them up. We seem to cover a lot of these. Yep, you cannot have a situation in which four or five company to company Loops make up the majority of the board over a two decade period. That means you are not extended your talent pool. Um, not gone. Why you've not gone deep all you've done is gone to other companies and just recycle recycled board members through yours, right? Like you are just to feed her system. This isn't, you know, American baseball, where you've got like, you know, the you're just trading minor Leaguers up to the major league and sending them back and rotating. Whatever. There is a lot of talent out there that you could put on this board. So, I recommend well before we get to recommendations to your point, they also pay their directors quite well, and they actually could lure talent to It Procter & Gamble, quite easily. And looking at these directors at their bios. I think they'll be okay. If they get like they may not offend them, you're not gonna lose a friendship at the Country Club. I think they'll be all right. I will be fine. They're not a former CEOs or, you know, Christine McCarthy, former CFO of the Walt Disney Company. I don't be okay. So use that use that money, that you pay them and maybe yeah, to Matt's Point lures some talent. I mean, we did an entire board draft on this show for Darden Restaurants. We basically said what happens if you start from scratch as a company, like Darden Restaurants. Well, what happens if you thought about the Procter & Gamble board and said, there's nobody on the board. What would I put on this board? Because it, when that's your starting point and then you look through the people look impressive, but you would also say, well there's actually gaps here. There's gaps of what's on the board versus what I would want skills. Good. Yeah. Um and I think Gap. Number one is you need to vote against Terry Lundgren. There is literally zero need to keep him after 11 years and he's connected 15 different ways to 14 directors. Well, don't need that. How about the Fact that he's over the age of your stated Paul policy, right? Your retirement age policy, I think easy enough, right. A lot of times when they when they sort of like make an exception for the age, it's usually for like Founders or like, you know, like somebody who's been on the board for 30 years. I don't understand this one at all, like, well, they all have a, they also have a Term Policy, right? Which is more than most S&P 500 companies in America. They have a, it's not just age, but they have an actual term. Is it a decade? Do you know that I don't already over? He's 11 years, he's over a decade, and he's over the age, and I can't imagine no offense. Terry Lundgren, I can't imagine your Irreplaceable on the Procter and Gamble to your point. There's another director who she's also over 70 has been on the board for over 50 years is my second vote, again, Patricia is my second. I only pointed out because you have the state Policy. So just, you know, how about I mean, but it's also, it's really simple. She is significantly connected to this board also and if you're going to kind of like root and stem this board out of like, you know, horse trading. Well that doesn't surprise me. Yeah. When you look at her next year, she's over the retirement age, just do it one year early and find somebody else doesn't surprise me. Look at her bio here are some of the names in her bio, a former CEO chair Archer, Daniels, Midland, former EVP, at Chevron, she was on the board of 3M. I mean, doesn't surprise me that she's highly connected. We all have to ask questions like when we talk about this all the time, we know that board directed behavior is viral. We know that because academics have studied it and they show when you put people in a room when they've had an experience, they share that experience. And if there was no accountability for that experience, they do, they weren't held responsible for that experience. They would, they will make that behavioral go viral as in, If you if there's something gray about restating a financial, it falls on that Gray Zone and you say no, don't restate and then nothing happens. Nothing bad happens. Your tendency will be to go to the next team that you're on and say, I was in the same situation, we didn't restate. There was no negative implication to that, that's what the academic research has found. It also applies to things like product, safety culture, those things are repeatable and the culture. You have on this board, you mentioned 3M. You mentioned Boeing, these MidWest, American Mafia boards, these these sort of American beta boards, who have been trading with each other, are unicult. And at this point, we're paying for a unicorn culture that is cost, shareholders, tremendous amounts at Boeing at 3M, like these companies are paying. Yeah. And you're seeing weird like, like cowardice from boards, like deer, who are flip-flopping on diversity in their Workforce, right? Like an emphasis on Maximizing their talent pool. They don't want to say anything about it anymore. What's your referencing is the controversies? Performance number that I mentioned that the exactly right? So Only only two directors, only three directors even have a performance over 229. Most of them are like at 100, less than 100. So, yeah, that's that might be another easy way to Target who to vote against at this company is just root out. Some of the low, the directors with low controversy numbers. So it's against Terry Lundgren against Patricia Wertz. And I think there is a third item here, which is an engagement item. You need to break the chain of Highly connected lead, independent board members and to see, you know, I'm glad you brought that up especially in the midwest. I've noticed in the Midwest region, we see a lot of that. I off the top of my head, I'm thinking of companies like McDonald's and exactly caterpillar. You see, a lot of Highly, the lead director is like everyone's best friend basically and they're usually the longest tenured person on the board next to the CEO that together for a long Procter and Gamble. Like they haven't been together as long, but it really is a fallacy that there is a lead independent director. It's basically a game at this point. So I think the engagement here is if he kill the CEO chair, Combo at boards like these it all boards. Invites too much power or vote in or and or vote in a new lead. Independent director try someone who's actually independent like on your board. You have Brett Biggs who's an ex Walmart executive he's less connected to the rest of the board and Walmart actually represents 14% of Procter & Gamble's revenue and I would guess right. Everything they said it's like all comes like they're selling stuff to Walmart which there's no more independent voice than the guy who represents the voice of the customers. Right? So on your board you have better options than like what you're what you're using which is Joe Jimenez is the lead independent director. So I think the three things here are against Lundgren against works and engaged either break up that CEO chair combo or get some actual Independence. Listen, the looking at the figures from last year, the director with the second highest vote, Against was actually, in fact, the CEO and chair John Miller, right? Yeah. So you know, this is a classic board that very well should emulate a European company in the sense. That, why do you even need this guy on your board in the first place? I know it's that, is that sacrilegious? Yes. In this country to even suggest that you're suggesting, you know, that breaking up his roles CEO chair, which I absolutely agree with, but, you know, he got 10% votes against at his last at the last meeting which again does not fire him as CEO, but I think those shareholders are on to something because I don't even know why you need this guy on the board in the first place. Um, yes, so those are my recommendations, all right? Moving on to do you have any input on say, on pay? I just want to before you, give your admission sound pay, I just have to say one thing that always gets me always gets my goat. So I I opened just a look in the last two or three years, right? This is what competition committees do and this is again another reason why you don't want your friends and former CEOs on compensation committees at least, okay, the executives want that but the shareholders shouldn't want that. So in 2022 that they gave the CEO, a long term incentive, a word of 11.2 million, right? And then the next year to 2023, they upped that to 14.5 million. And then now this year that's up to 60 million. And again, there is no reason for this in the America has not changed that much. In two years that he needs an additional 4.8 million dollars tax and they give no explanation for this. I just wanted to point this up. This is on the subtlety. I think that shareholders lose because proxies, you know, they don't give you that kind of, they don't kind of backdate. Tell you what they've been doing, you have to open up the proxy yourself to see how these competitions full of CEOs. How they? Just keep making this situation worse every year and to that end. Actually, there's a you can tell that there's a game involved. So they report the CEO a pay ratio, right? And this case is 329 to one the median employee salary, a projector in gamble, 169,000 about 70,000 bucks, right? But Mueller summary comp was 23 million in this proxy. But when you look just further down the pay, for perform versus performance chart, they actually show you his realized pay how much money he actually took home from those long-term incentive Awards. In fact. Mueller takes his his bonus in cash instead of equity, so he gets a cash bonus every single year. Plus he's getting Equity grants, plus he's got long-term incentives, his actual take-home pay in the same year, was 38 million? That is a 15 million dollar difference and that is one of the smaller years, there was a year where he doubled from 17 million to 34 million, which is essentially means on on the first day of January. After the winter break by probably what by noon, he probably made the same amount of money than the median workers, going to make a whole year, but I actually have this question about, why do we look at CEO? Pay ratio as his summary comp over the median and not his take-home comp over the median. The difference here is he goes from 3:29 to 1 to 5:43 to 1 in terms and the S&P 500. The average is about 250, and even if you look at the take home, the average is in the 300 range, which means this is a CEO. Who's getting paid significantly more who's effectively using the board to save the job of the comp committee chair because he's past retirement age. And he's been there for too many years, but they're keeping them around and they're making exceptions. No wonder why you're making it exception. This is great from a shareholders prospective. Again, if you look at our performance numbers, this is a guy who hits 865 and earnings but only 382 in Toledo, Total return. I mean, I'm inclined usually to vote no on like page just in as a general rule, but but barring that, in this case, I actually think we Need to rename say, on pay say, on pay committee. Because what the real problem here is, is the people on this committee. Keep inflating. It doesn't matter what the performance is, they keep inflating the pay of the CEO to your point on a year on year basis, even relative to the median employee. So I think, in this case you are abstaining from pay and you're voting out Lundgren, you don't like I you vote no on pay abstain from pay. I don't even care what you do with the page. Just don't say. Yes. Just don't say yes to Lundgren is really longer is the, he's the the committee chair right Lundgren, share, that's right. And let me point out that Terry Lundgren is a former CEO at Macy's. So he's in his self-interest to make sure that these numbers go up year after year. Finally. One shareholder proposal on the board from our friends at our junah Capital are they are friend, they should be a shareholder proposal regarding racial and gender pay gaps. These are always know brands for me. But where do you weigh on this one? So this is I read through this proposal and actually they're looking for they are already have disclosure around racial and gender pay gaps but our June is asking them for a slightly different number. They're looking for an unadjusted number or a different kind of adjustment. If you are. Procter & Gamble. Why did you waste like 100,000 dollars on a lawyer to write up? The reason why you don't want to do this this is like seven seconds for Gus and you know the accounting department on us Excel spreadsheet. This is an Excel spreadsheet proposal. This is literally just report the number slightly differently that you already have. In fact, the fact that you're fighting. It makes me think you weren't serious about the numbers in the first place. Well, these aren't they're not asking you for something new, they're asking it for you, for what you have in a way that they can make better contextual comparisons. That's it. Look your logic is impeccable but but pulling back. This is a precedence issue, right? You you manage management can never say yes to any shareholder proposal right because the board these boards are full of former and current CEOs they're just not in the game of saying yes to any of this right? Yeah. No my my feeling is Should have never gotten to a shareholder proposal like they understood. Like, yeah, that's your phone with Arjuna saying like, hey, what if we just I'm just gonna point, I'm gonna send you a spreadsheet and I'm gonna make it equal cell B7 instead of cell B6, right? Like clearly that number or something, they're not proud of. I don't know what the problem is, but like, it actually looks more suspicious that you would take this all the way to the proxy and have to vote know, rather than just. This should be one of those ones that never even makes it onto the proxy, because you sent them a slightly different spreadsheet that you had. You could even be clever about it. You can say, okay, or Juno will show you the number. We're not allowed to write it down but we'll give you 10 seconds to look at the number. All right, that's it. I am voting for this proposal all day long. I vote for anything, our Junior Capitol puts up as a yes. For me, that's the proxy countdown for the week of September. 23rd 2024 a few days later on this show. Join us next week. This week, I don't know when we jump back into the alternative democracy pool Forever on the lookout for shareholder. Sharks floating Band-Aids and Wayward directors.