Transcript
This is proxy countdown. Welcome to the Big Show for the week of February, 12th 2024 alongside my tag team partner. Matt mascardi. I'm Damien rawlas on today's countdown. A female CEO hiring spree in the Fortune 500. Some Fuzzy Math at the Disney proxy contest. Reverse psychology at the Emerson Electric annual meeting. Voters, not named Tyson at Tyson Foods AGM. And on the big vote, the World's Favorite Drug Company that also happens to be my favorite ESG company. Let's get to the trade wire. Matt we have two more female CEOs in the Fortune 500, this is not an early April Fool's joke. First Freeport McMoRan announced that Kathleen. Quirk will assume the role of CEO effective. As of freeport's 2024, annual meeting in June She will replace Richard adkerson, who is remaining on the board as an executive chair with his 23% influence. So it remains to be seen who will really be in charge at Freeport. Kathleen and Richard both joined the company in 1989, but the new CEO is nearly two decades younger than the executive chair. So maybe her time is coming and at JetBlue, we have a glass Cliff CEO alert as incoming. CEO, Joanna geraghty will have to address JetBlue's reliability and cost control problems. The airline is still losing money while larger Airlines have returned to profitability. Post-pandemic. And Joanna, who was replacing a dude? Named Robin Hayes has been CEO since 2018 and before that she was actually Chief people officer at Jeff below. So first of all, I'm throwing a yellow card at you for the Freeport McMoRan, the move to Executive chair is the classic dude, move to stay in control. And not actually relinquish your your CEO role, but not have to show up every single day. Yes, for now, but I'll say it again. Richard Ackerson is actually 75 years old Kathleen, Quirk is 57. So I would think her time is coming. Hopefully, this is a leadership transition period. Second I love calling this a bonanza. What would you what did we say? A higher? The hiring. Hey, two out of 500 in the Fortune, 500 is a law. That's a lot of female CEOs, all at once. That's the only male index in the world and only 10% of the companies have a female CEO. So it is sadly a spree but it is not much of a spree know. Let's move over to our proxy. Cage matches still is Disney. I mean Matt this is probably the most expensive proxy contest known to the world. I just want to point out. One particular try in filing. And let me tell you between Disney's animated, Duck videos, and Blackwell's, rusted, nickels, and try and shiny baubles. There are about 20 filings per day for this this very contest, but I just wanted to point out one filing, a particular from trying that includes language such as this. This is just for the, for the ESG nears out there. This is just the greatest language. I have two examples of it first. all references to proposal 7 eighty Pages, 672331.33 34 and 35 of the Tryon groups, proxy statement are amended and restated as follows proposal 9 And this other one, Matt all references to proposals, 5, 6, and 8 eighty pages, 626.33, and 35 of the Tryon groups, proxy statement are amended and restated as follows proposals, 5678 and 10. This is how much in the weeds this proxy, condos to understand, and anything. You just said, that's bananas. This, this is the state. Sure, of modern day, proxy contest. And this is probably why shareholders get exhausted and, and very rarely vote through the dissident directors because it's a barrage of nonsense. And even skilled ESG technicians like US map are overwhelmed and don't understand what's going on. That's what. Yeah, there's an ongoing irony with the whole house action. Here, he was on CNBC, I think this week talking about how that Disney's making all these announcements, but there's little meat on the bone of their announcements including the epic video game deal was a 1.5 billion dollar deal that he made the irony here is that in all of Trans actual announcements of their own, there is no meat on how they plan on getting Disney back to the magic. Other than adding Nelson Peltz himself to the board and Jay rasulo former CFO. It was the former CFO to the board. And when asked for any detail, how he intends to achieve the things he's hoping to achieve there is, there is no actual strategy involved. So what we're really talking about is a fight between a billionaire and and a billionaire, right? And Igor versus pelts, and it's, it's turning into this Petty fight where you need a, you need a slide rule to figure out what proposal anybody is actually talking about voting for all reminds you according to a recent try and filing all references, proposal 7 eighty Pages, 6723, 30 133, 34 35 on the triangles proxy statement are amended and restated as follows. Procs proposal 9. There it's fixed. I know exactly what that let's move over to our vote results table. Matt, we have three large cap companies to report on this week. First, at Tyson Foods, we're over. 10% of the vote, was against directors, less belege, and David branch check. And we're two shareholder proposals a report on how its lobbying aligns with the company's science-based targets and long-term Net Zero Ambitions and an audit. Assessing the effectiveness of the company's policies and practices and preventing illegal child labor. Each also received the support of over 10% of vote. So why is this significant Because of the roughly 912 million available votes, at Tyson Foods, roughly 77 million of those are held by the Tyson family. Yes, the same Tyson family, that controls Tyson Foods and let's see afo John R Tyson keep his job after being arrested for breaking into a woman's house and sleeping in her bed while drunk. So Matt, this means that the adjusted vote in what I'm calling, the real vote I suppose. This is the vote of non Tyson family members. That vote actually voted to remove director, David brontech and to support with 50% 54% of the vote to support an audit, assessing the effectiveness of the company's policies and practices in preventing illegal child labor, which seems like a very important proposal and look, that adjustment doesn't even take into the account. That's 7% of the vote is Blackrock and Vanguard, which traditionally, you know, like would vote with managing and in this case, might not even be voting with management because it's so ridiculous. Our recommendation here was to vote against everybody really as just a sign of displeasure, because none of your votes matter. Like the family controls the vote effectively here. So we said vote against everybody and it looks like that didn't come true. But there is some dissidents At Franklin resources, five directors, received over 10% of the vote. John, Kim Curran, King. John teal Seth. Wow. And and Jeffrey Yang. How about the fact that all five drugs have one syllable name? I was gonna say a miracle in itself. A song that sounds like a song, you just saying. Okay, so I know they're adjusted vote after removing the vote to the founding Jansen Johnson Johnson, family members, and the institutional owners that you just mentioned. Yeah, State Street, Vanguard and BlackRock. So between those founding family members and those three institutional owners, they control 60% of shares. So, if you remove those shares and adjust the vote, this means that nearly a quarter of Franklin resources shareholders voted for the removal of five board members, which is a significant level of shareholder descent. Yeah. Yeah, I think actually, the adjusted votes are the most important way to look at these votes because you do have passive owners who aren't making a lot of active choices on at some of these companies, particularly large cap companies where They rubber stamp everybody including the Kimball musk's of the world and you have family owners that are basically doing whatever it is, they want, it's their board. So the adjusted vote is a real measure of sort of active investor interest in the board members. And lastly, hold on to your hat for this one Matt at Emerson Electric. Okay. So there was a management had a proposal to declassify, the board, okay, which is unusual. The board at Emerson Electric is classified, meaning that directors are voted on every three years. It's not an annual vote. So management themselves, how to proposal to declassify the board and it received the whopping support of 98% of the vote. However, Matt The Measure fails. Of course, why? Because the proposal required, the vote of 85% of outstanding shares, okay? So bear with me, I did the math here, there are roughly 587 million shares outstanding. So 85% would be about 499 million, the total amount of possible votes at this year's annual meeting was 490 million. So there was no possible way that this proposal could have passed this. In fact, the fourth time this proposal has failed The board said, in the proxy statement that we recognize that a Declassified board in the right of shareholders to amend. Bylaws are increasingly considered important aspects of good, corporate governance and respond to these Trends and shareholder requests. We have acted. So the board is saying that it has acted by putting out this proposal that it knows will fail because it is a virtual impossibility to pass this vote. And how do I know this? Because listen to this, Matt Shareholder activist, John Sheva, Dan has a solution to this. He put up a shareholder proposal this year asking for a simple majority vote that would replace the owner is requirement for a super majority vote but this proposal in fact was rejected by the board, they said that that it would harm. Long-term shareholder interests and ultimately is an unnecessary distraction from the company's current efforts to continue its record of strong governance practices. This is the craziest game. I have seen in quite some time, but let me tell you this, Matt, this proposal passed 71% of shareholders, actually agree with this proposal, it passed. So, what is the company going to do now? Well, these are advisory votes, right? They don't have to absolutely, this is not binding, but 71% of shareholders passes after 98% said that they wanted to declassify the board. But the game, the board is playing a tricky game of Deceit here, with with what's really happening I mean look that I be curious. This is a stock that has not performed tremendously well over the last five years. I mean, it's on, it's it's it's underperformed. The S&P 500, it's no Tesla but it's not like it's an underperformer. It's up almost 11% just this year. It's, you know, in the last five years is up 55%. So while it's not outperforming, the S&P 500, why can we have this vote on a classified board in at Emerson, Electric of all places where there are barriers to get to get done? But not at a Tesla or a place where you have actual problems. I don't, that's, that's the part. I don't understand because we can all agree that it's nuts at Emerson Electric, but not nuts, somewhere else. How about this as a solution before we move on to our big vote? 98% of the voters supported to declassify the boards. So how about this hold annual elections any way? And let's just see if there's anyone in that 2% who is going to care and Sue to get this change because it's not going to happen. So just just hold them. Anyway, yeah, I'm with you. Do it, the big vote, let's move on to the big vote. For this week, the week of February 12th, it is Starbucks. America's the World's Favorite Drug Company and it happens. Matt to be my favorite ESG company and I have a bunch of reasons why that I'll point out curious, let's get right to it. Let me just first give you a brief profile of the ownership at Starbucks. Two major institutional holders that's Vanguard at 90%. BlackRock at 7% found the founder and former CEO like three different times. Howard Schultz actually still controls 2% of voting shares. But I wanted to point out some before you would get to your recommendations about the board. I wanted to point out a few things that I liked at Starbuck's. First of all, There is a, there is actually a proxy contest this year. This Trek. Organizing Center at the soc is putting up three dissident directors so already we have something fun going on at Starbucks and we'll get to that later. Second of all, all of the directors are in their 50s, except for one, I like that. I don't like I've ever seen that before. Second of all, there's a three-headed non-white monster. I'm calling here at Starbucks. So, the three, most powerful directors at Starbucks are the CEO lacks laxman narrow semen chair, mellody Hobson in. Della, who's the CEO of Microsoft? They control 61% of the influence at Starbucks. I don't think I can. I don't recall, another American S&P 500 company that has. That is not controlled not controlled by family not control by a single founder like Facebook where there's three people of color in control company, pretty remarkable. In fact, the board itself, Matt is a is a majority people of color. They represent 54% of the board and 67% of the influence of the remaining five. That includes a gay woman a Dane and a bearded dude. So this is just an incredible the anti-wolf would call this board woke. I assume I just call it fun. I'm just impressed with everything at Starbucks. I also want to point out two other things. First of all they have a director named Andy Campion, right? Who really if you add an age, he's Andy Champion. Right? And he's on the not only is he the former CEO at Nike? He's also on the board of the LA 2028 Olympic Games and the director of the UCLA Sports leadership program. I just think it's great. They have a guy named Champion who's that from Nike. All right, but finally beforehand off to you. This is why not the really, the one of the main reasons why Starbucks is my favorite board is that each of the directors list out their coffee choices. Their favorite coffee every year with Starbucks. So I want to highlight the five that I like the most. First of all. Rich Allison. He is one of the the only white men on the board, right? Only one of the few white straight men on the board and his choice is flat white. Right. Which is perfect because his quote that goes along with this. I'm assuming it's not in the proxy. I just assuming. This is the quote that goes along with it is I'm the former CEO of a mediocre Pizza chain and a white guy with no real Starbucks board power so that's why the flat white sure. The second one I like is mellody Hobson chair. Mellody Hobson black woman, mellody Hobson. Her favorite coffee is Pike, Place, roast black and her quote of course is keeping it real. The third one I like is sat in the Della he gets a double espresso shot because of course his quote is I'm important. I need the energy. Of course, he would have a double espresso shot. He's also the CEO of Microsoft Manila. Daniel server. J, he just takes a cappuccino because he says he's the old guy from Mexico. He's the only guy in his 60s, he's Mexican. So, just seems cappuccino, just seems right for him. And finally, current CEO laxman Harris semen. He gets a doppio macchiato with steamed skim milk. And his quote is, I don't drink coffee but it's just a humble brag that I trained as a barista after he took over as a seat. So I I love, I just love, I love these choices. I love this board. Honestly, I've never heard you gushy or about a board, then this board, I really do have a lot of fun with this board, but now I'm gonna hand it over to you and get some actual analysis. Let's start with the election of 11 directors and I'll remind the listening audience. That three of these directors are new. They were appointed to the board in January, as a means to fight the dissident directors. That were also have been nominated by the Strategic organizing Center. So it's, there's some strange things happening on on this Starbucks Sports. I'll hand it off to you. Yeah, I think the that with the gusher side, the Thing to remember here is, there is a dissident slate of three directors and the reason there's a dissenting and dissident slate there, I've been anti-union busting strategies that Howard Schultz is repeated repeatedly over years. This is in the first time unionization has come up at Starbucks. In fact, I think it was in the late 80s. A union was formed that lasted a very short time at a Starbucks store. This is a company that was founded ostensibly in Seattle where they're, you know, flagship store is and that's a place that where unionization is hot except say, it's still acceptable. There's there's a lot of acceptance of unions there. So this is an ongoing problem and Starbucks has seen fit actually to fight against unionization, not just strongly. But they've been actually called out as a possibly illegally fighting against unionization across several times. A number of their stores. And across these efforts so much so that as unions passed and a store by store basis or in region by region basis, even the headquarters has seen fit to offer benefits to non-unionized workers and say. Now, because you're a union, we can't offer you. These benefits until we negotiate with the Union, they're using things like unionization. You know, your unionization as an effort to limit employee access to benefits. They have also completely closed. Branches, that high performing branches that unionized. Yes, that's right. The door, they're shutting out off actual stores where they unionized. And then saying, after the fact that this has nothing to do with unionization effort and just coincidental. And I will say why this is so important because this, this company is Uber successful again, this is the World's Favorite Drug. I don't even know how you screw up being a drug company of this magnitude. The one thing, That could derail Starbucks. This company is its relationship with its employees with its Baristas who they refer to as partners. This is the one thing that could derail this giant of a company. And I think that's where the, I mean the dissident slate is entirely about this, right? Like, yes. And it was filed by the Strategic organizing Center along with the service employees, International Union. So this is very much coming from the labor movement. So here's the here's where I started my analysis because the gushing, this of this board actually and like the the makeup is board mice. Actually, so we're clear. We're clear my gushing. This board is not for individual members, it's the joy and entertainment but I get as an analyst reading the proxy statement and in covering the company I know it's not a vote of approval for the directors. I know but I love the company but I love there's for from Analytical standpoint. There's three questions that every investor is really coming at this or likely coming at this thinking, right? One is you're trying to solve what could be a long-term issue with labor? Then the slates that's been put forth is attractive, right? Like they are the guard rails against these labor issues. Now I personally don't think these are long-term labor issues. I think these are short or midterm, labor issues. I actually think and Starbucks has been open about the fact that they're building machines to replace some of these Baristas, right. Like the AI future actually, might be dispensing coffee with fewer people. Not more and arguably, if you're an investor, that could be in your head. But one option, when looking at this vote is I want to solve the labor issue. And this slate is attractive for doing that. The second way is, I'm looking at this board and I'm thinking Starbucks is a mature unregulated Drug Company. How do we make this into a Perpetual growth machine? Obviously drug companies themselves in their nature, are can be Perpetual, but this board has added people, like, Neal Mohan from YouTube, which is a drug. Let's not, let's not like sugar-coated, they added, Daniel Ceviche from Grupo bimbo. They do. It's baked goods and snacks and food service. Yeah, it's effectively a drug Wei Zhang from Alibaba pictures group. Like this is, the, this is entertainment. There are effectively feeding you with people who are very good at The Addictive quality of it. It's incredible. They the other new directors, Mike Seaver. He comes from a cell phone companies, a CEO at T-Mobile. They have, as I mentioned before, satin Adela, from Microsoft, they have Jorgen vegan nude strip. Here's a former CEO of Lego at probably the most addictive toy known to the world. Yes, they have best Ford from a butter company. She's CEO of Land O'Lakes. Someone from Nike, some of them from Domino's Pizza. It really is like the world's most addictive product. These are some of the smartest people at taking something that's an addictive product and figuring out how to distribute it to the most people possible. Like this is in that way, if you are thinking of Starbucks, as turning from like, some some, a fairly mature company into a Growth Company, selling addictive products and new ways. This actually is an excellent board to do that. There are very few boards that are constructed or as or as well suited. I agree for that outcome but what I will add here though is that and I I applaud the majority people of color. I am I applaud the power that women have here as well but it does show you one thing very clearly is that this type of diversity is masking. The fact that all the directors kind of seem like the same person. Yes, it's a unit thing called, yeah. Alright anyways, yeah, And they're all kind of represent, they're all basically CEOs, Pharmacy, CEOs of companies that sell addictive products and they're good at it right? Like which is good in some ways, but that brings me to the third option. If you are looking for some sort of balance knowing that the long-term isn't just about Labor. It's about climate change and supply issues, with coffee beans and chocolate, and All Of The Addictive things that Starbucks actually does sell tea. And you're dealing with you, you need growth, you can't let you get away from growth. There's an AI future here. You gotta balance all of those things, right? There is some level of mixture that need likely needs to happen on this board. Like the guard rails can't just be growth at all costs. Addictive, a fully addictive oriented board. It can't just be add three Labor candidates to, you know, derail, the, you know, like the the labor policies of Starbucks which are inherently negative against their Own Partners, quote, unquote. There's some mix, right? I am a proponent of the mixed strategy in the end. Yeah. Because I, you know what, and I will tell you, just a peek ahead at the, at the say, on paper proposal and executive pay at Starbucks, is that the company would seemingly agree with you? Because even its pay plan mentions, things like sustainable supply chain, sustainable coffee, sustainable, Dairy regulatory sustainability hiring more, you know, people of Carl and Leadership. So we talked about the bristles before. This is a company, unlike others that really should be focused on the different tenants of stakeholder capitalism, right? Because it really does, it needs to control, not only its labor force, but its supply chain moving forward. Otherwise, the company will implode. So, I think that's right. And I think actually, and to get to that place, right? I think we need to understand two things about how this board in the executive, the leadership is constructed. One is the power. Center of the leadership because you mentioned, you know, laxman and Melody Hobson as a Duo owned, 46% of the overall influence. When you add in the fact that you have what we like to call the Southeast Asian male CEO, which is usually allowed founder, get followed up by a quieter Southeast Asian male. Now, this is like a Trope at this point because we've seen it at Google with Sundar pichai. We saw it at Microsoft with Satya Nadella himself. We've seen it at, we've seen it in a number of places. Now, now Starbucks from Schultz to laxman Eric Simon, but when you add in the fact that Nadella Neal Mohan and blacksmith are all basically of a similar cohort in that way, throw in Hobson, and you have not only the most diverse controlling cohort. But arguably a very similar thinking Cohort, the power structure is very similar in with this group and you have Schultz who's a 2% owner who you can't discount while not on the board. The shadow influence. He's like leader as a 2% influence until he as long as he's breathing. There is a shadow influence and maybe a boomerang CEO possibility. It's always there. Always there. This is there are bad signs for groupthink here and I don't I got a little bit deep in a free float. Analytics offers group think metrics, I got deep into the group, think, metrics that include things with. This is a board where the vast majority of them are their CEOs. They are or exceeds, they are mostly within two years of age of each other, which you don't see that. As I said at the top all all, but one are in their 50s within a, within a very dense rain, never seen that before, they are mostly Men, they are actually mostly Democrats by political lean. There's huge connections professionally back to just a few companies including Nike Microsoft Pepsi McKinsey. Where laxman was at McKinsey for a long time and even affiliations both Sachin Nadella and black spinner on the council Foreign Relations, for instance, On The Board of Trustees of the Brookings Institute laxman sits there. But so does Phil Knight from Nike. Like, there are lots of these overlaps but the most interesting one is nearly everyone on the board. While they might be sort of in the drug delivery system. There are so they love autocracies the Christiansen family owns Lego the Estee Lauder family where mellody Hobson's on the board is owned by the owns Estee Lauder Google where Neil mohan's an executive is Sergey. And Larry, a dual-class company T-Mobile was owned by the German government. Baba, Jack ma owned Alibaba outright Stitch, fix 23andMe both with laxman's on both of those boards or Neil mohan's on both of those boards. They're both dual class Schultz himself made this sort of like an autocracy. The founders sitting on the board Boomer aiming boomeranging back. These are board members who are used to a monarchy or a totalitarian sort of situation. And let's not forget who sought over a place which was the Empire Bill Gates over Microsoft. Exactly. And well, while Gates was an executive chair on Microsoft, for a long time, even as Ballmer was CEO, these are directors, who are used to singular powerful, people, controlling the outcomes of the companies that they either work for sit on Boards of and this is almost uniform across all of them. So you have a mindset that is, we're okay with an auto. That for the most part, we're mostly of the same age. We're mostly from the same set of companies, we do mostly the same thing. We're not even look like each other. We and we we started to look like each other. This is like, there's a lot of groupthink flags that sort of go off. So this is, it sounds like you're leading to maybe we haven't talked specifically about the distant directors, but it sounds like you might be leading to, to supporting the distant directors, which who are Maria? SJ Joshua got bomb and Wilma Liebman. Yes. So let's get to a recommendation, right? So I said the record, I thought of the recommendations in three sets, one being, if you are you vote against the entire dissonance late, if you're all in on the addictive future of Starbucks. If you are, this board will get you growth at all costs. Kind of thinking, they'll be fewer guard rails when it comes to keeping people, addicted and future growth and the dissident slate is a barrier to that in a way. I would say if you're all in on the labor issue, if you are socially oriented investor, stakeholder oriented investor, then you vote for, at least two of the dissidents late, and I would say, at your Vesta and Liebman fit that role really well. You get a government sort of play with echeveste and Liebman is the nlrb rep. You don't really need a third person, there you sort of need at least two. But you could go incredibly to your point, the dissident directors, like the board as Starbucks are also kind of Monolithic, right? They're all, they're all lawyers, they're all about 70, they all basically represent the same interests. I agree with that. And but I think they've targeted, one of the things that associate is done, is give you opposed directors. They've given you three directors to vote against and replace with theirs. They're opposed directors are rich Allison and he championed champion and your Ignite store from from Lego, and they claim they've chosen. This is the quote from their filing. We have chosen to oppose the opposed company nominees because each of them holds a position of leadership on the board by virtue of chairing, at least one of the boards committees. I just taking committee chairs. I actually think they've, they've, they've missed the argument with those three. I'm not saying that they're wrong about them doing committee chairs necessarily those are powerful positions. Yeah, I mean from our perspective though they are targeting people with a bit more influence than others. Know, in general. Yes. But I but they didn't put, they didn't say vote outside in Adela who is the third most powerful person on the board. They didn't say vote out mellody Hobson, who is outside of the CEO? The most powerful person on this board. I would even argue that Daniel Ceviche is just join. Just join from Benbow has a history of Labor controversies. So And I I so deceiver Michael sievert from T-Mobile. They had actual collective bargaining issues in their past that they've had to deal with and they did it badly. If you're going to vote for Labour, wouldn't you vote out people who have been bad at Labor? Except except that? The wrinkle of this is a these these three new directors that you're referring to were just put on the board in January. I don't even know that the soc had time to digest who these people were. I think that's correct. But the investors do have that time, right? Like so I would necessarily if you're for the labor side of this, you know, you're approaching this from a social position, I would vote out not necessarily who they oppose. You can vote for the slate and vote out. Anybody you want to, you know, and I would choose not necessarily just the chairs of committees, which is a short hand, for replacing power at boards. I would vote out either Nadella and Hobson's been there. Are for the longest, she's the longest tenure director. Like this is a chance that refreshment. I would also think about years for Melody Hopsin, I would think about sievert and Daniel Ceviche because the they've had labor issues in the past, right? That's what you're trying to solve with the Slate. I will say that I fear that this is why the dissident sleep will fail. Is that there is a bit of confusion here with. I would think you target the three new directors. They haven't been here, they don't they again to your point. They represent basically the same person anyway. So so why not just say we reject your new additions and will be the new addition to said, but their their kind of strangely pointing at the the chairs of the Committees, and I'm worried that the shareholders will kind of be overwhelmed by, you know, who to shoot who not to choose. And that in the end, this will be a washed. I think that's probably true, which is why I would advocate for the final, this this I'm more balanced approach, which is you vote? For one of the dissidents late, and I would go with Wilma, leben Liebman from nlrb, and I would actually engage simultaneously to have her installed, on the nomination committee, at a minimum, at a minimum, but also put her on the Community Committee, which I think is a bit of a fake committee, but the nomination committee, that makes sense. It gives her, some power gives us some influence right out of the gate moving on quickly. We're over time say on pay Starbuck's, I will say I'll try to keep this brief again. Another reason why Starbucks is such a favor from analysts, ESG analyst perspective, is that Matt, this compensation discussion analysis is 43 pages long and includes every dream of every woke. ESG analysts including 15% of The annual plan is based on ESG goals, which include inclusion and diversity targets, including a people of color retention rate at management level with actual payout, based on actual quantifiable goals. Seven and a half percent is based on sustainability goals. Some of which I already mentioned, like a sustainable supply chain. They had a representation modifier which will actually adjust down the long term Equity if they're not doing a good job. Keeping people of color at management level. It's just really, it's incredible but In a nutshell, the CEO made 15 million dollars last year and this the CEO to median worker pay ratio was over 1000 1,028 to 1. So that might be the number that a lot of shareholders. Are really focused on when you consider the battle. Now, going on between management and the Baristas, you know, in the irony is when you get to the end of the 43 pages and the numbers 14.6 million 15 million, it feels like a Gaslight. Like we just talked about 56 billion dollar clawback from Elon Musk 15 million seems like a joke and narasimhan just came from Wreck-It been Kaiser. Ben was his prior company where this is a raise for him. He just made like an extra nine million based on, you know, from from the salary, he was getting there. This feels like a four vote mostly because it seems like the most successful drug delivery company is doing exactly what it's supposed to do. And there's so much layered in here. I'm it's confusing to me what to be anti. Uh, let's wrap up with the share of the proposals at Starbucks. This year, we, I will remind people that last year. In fact, a sure her proposal passed 51% of shareholders voted to support an assessment of worker rights commitments. So again, just proving that that this is the number one issue a Starbucks, right? Because even even 51% of shareholders, you know, want the company to weigh in on their relationship with their workers. But in 2024, we have three votes. Two of them are anti woke, I'm almost tired of spending time on these. It's the same two anti-work proposals every company from the national legal and policy Center. And the national Center for Public Policy and research. And then there's one from Peta, a report on plant-based milk price. I don't have a lot to say here map, but, yeah, vote against all of them uniformly. And I think like, I actually the anti-walk ones are easy, the plant based milk pricing just feels Like Miss guided, use of time. Like I don't know that we need a report, I love reports, but this seems like a one that is both outside of scope for Starbucks. And while I love, you know, what Peter's trying to do. It does seem like a bit weird. I'm against all of them. All right, let's wrap up our big vote for the week of February. 12th 2024, Matt is saying, what are you saying on the board? You saying you vote? Go ahead, four Wilma. Leave men and again, director, Mike sievert and that's your swap that I think. Is your swap? So taking it one, dissident director at a time, a vote for Lee minute, voted against sever. You're saying yes, I'm saying, hey, you're saying, no on all, share of the proposals. That's it, that's the proxy countdown for the week of February. 12th 2024. Join us next week, when we jump back in to the alternative democracy pool Forever on the lookout for shareholder sharks floating Band-Aids,