2017 Annual Corporate Governance Review > Annual Meetings > Shareholder Proposals > Say-on-Pay Votes 2017 Annual Corporate Governance Review > Annual Meetings > Shareholder Proposals > Say-on-Pay Votes This page intentionally left blank. Contents Executive Summary & Acknowledgements 4 Methodology 6 PART 1 – SHAREHOLDER PROPOSAL VOTING RESULTS Figure 1 Corporate Governance Proposals Submitted – 2013 to 2017 (Chart) 8 Figure 2 Corporate Governance Proposals Voted On – 2013 to 2017 (Chart) 8 Figure 3 Corporate Governance Proposals Voted On – 2013 to 2017 (Table) 8 Figure 4 Summary Average Voting Results for Selected Proposals – 2017 (Table) 9 Figure 5 Proposals Relating to Board Issues – 2013 to 2017 (Chart and Table) 10 Figure 6 Proposals Relating to Shareholder Rights – 2013 to 2017 (Chart and Table) 10 Figure 7 Proposals Relating to Proxy Access – 2016 and 2017 (Chart and Table) 11 Figure 8 Sponsorship of Corporate Governance Proposals – 2016 and 2017 (Table) 12 Figure 9 Shareholder Proposal Voting Results Sorted by Company – 2017 (Table) 13 Figure 10 Shareholder Proposal Voting Results Sorted by Proposal – 2017 (Table) 18 Figure 11 Shareholder Proposal Voting Results Sorted by Sponsor – 2017 (Table) 23 PART 2 – SELECTED SHAREHOLDER PROPOSALS – ENVIRONMENTAL, SOCIAL AND GOVERNANCE Figure 12 Shareholder Proposals – Board Diversity, Voting Results – 2017 (Table) 30 Figure 13 Shareholder Proposals – Political Contributions, Voting Results – 2017 (Table) 30 Figure 14 Shareholder Proposals – Gender Pay Gap, Voting Results – 2017 (Table) 32 Figure 15 Shareholder Proposals – Sustainability, Voting Results – 2017 (Table) 32 Figure 16 Shareholder Proposals – Environmental, Voting Results – 2017 (Table) 32 Figure 17 Shareholder Proposals – Climate Change, Voting Results – 2017 (Table) 33 Figure 18 Institutional Investor Voting Data, Select Climate Change Proposals – 2017 (Table) 34 PART 3 – MANAGEMENT PROPOSAL – ADVISORY VOTE ON EXECUTIVE COMPENSATION Figure 19 Voting Results for the S&P 500 Index – 2017 (Table) 40 2017 Annual Corporate Governance Review > 3 Executive Summary and Acknowledgements We are pleased to present the 2017 Annual Corporate greater support from foreign institutional investors than U.S.- Governance Review. based institutions. In light of the policy changes discussed above, this disparity appears to be diminishing. This year a majority of This year Georgeson partnered with Proxy Insight on the the investors detailed in Figure 18 voted “For” these proposals. coordination of voting data and analytics. Proxy Insight was instrumental in sourcing the annual meeting and proxy data Board Diversity contained in this report. In 2017 there was additional governance focus and heightened The 2017 report provides a comprehensive review of relevant media attention on board diversity. This year, investors voted corporate governance issues, a detailed analysis of shareholder on nine proposals related to board diversity, which represents proposal voting patterns and an extensive list of say-on-pay an increase from previous years — four in 2015 and five in 2016. results. Also of note, in one instance in 2017, the shareholder proposal received majority support, while no such proposals received Based on recent reader feedback and trends in the market, we majority support in prior years. We believe this issue will receive expanded our substantive review of environmental, social and considerable additional attention in 2018. governance shareholder proposals that went to a vote in 2017. Please see Part 2 for voting results broken out by proposal Average Majority Support for Shareholder Proposals category. This year we are providing three additional proposal- Shareholder proposals relating to the following three topics type tables and a new chart detailing voting decisions by received 50 percent support, or more, on average: institutional investors related to climate change. 1) Require majority vote to elect directors In our opinion, the following topics played a prominent role in 2) Eliminate or reduce supermajority provisions the 2017 U.S. proxy season: 3) Enact proxy access Climate Change Please see Figure 4 for further details. Significantly, during 2017, a number of prominent institutional Independent Board Chair/Separate Chair-CEO investors — including BlackRock, Vanguard and Fidelity — changed their voting policies on climate change matters As highlighted in Figure 5, “Proposals Relating to Board Issues – and are now more supportive of certain shareholder- 2013 to 2017,” there have been fewer proposals for independent sponsored proposals on this topic. Partially as a consequence board chair/separate chair-CEO. This trend appears to be of these changing investor attitudes, this year climate driven by more investors accepting a lead director with robust change shareholder proposals received majority support responsibilities, rather than separation, as demonstrating at three companies. Please see Figure 17, which includes a appropriate independent leadership. comprehensive list of climate change shareholder proposals, Right to Call a Special Meeting sorted by company. There has been a significant increase in shareholder proposals In Figure 18 we have provided a review of 2017 voting results to allow shareholders the right to call a special meeting of the on this matter for a wide range of U.S.-based and foreign company. This increase is largely the result of two prominent institutional investors. Historically, many shareholder-sponsored types of institutional investors — public pension funds and labor proposals relative to climate change have attracted significantly union-sponsored retirement plans. Both types of investors 4 > Georgeson | Proxy Insight have stated they view the ability to call a special meeting as a About Proxy Insight fundamental shareholder right. The funds have made progress Since launching in April 2014, Proxy Insight has become the in securing other rights — for example, the adoption of proxy world’s leading source of information on global shareholder access and the de-staggering of corporate boards. Their success voting. The company was founded by investor relations and data in these campaigns has led to a shift in focus to other issues business specialists Nick Dawson and Nick Arnott. While Proxy of significance. Please see Figure 6,”Proposals Relating to Insight is currently based in the UK and U.S., our operations are Shareholder Rights – 2013 to 2017” for more detail. truly global in scope with clients spanning five continents. These clients are not only large investment managers, but also include Proxy Access: Enact or “Fix-it” small advisory firms, compensation consultants, bulge bracket Proposals to enact proxy access decreased from 2016 to 2017, investment banks and academic institutions. We are closely while “fix-it” proposals within the S&P 1500 increased over the linked to our sister company, Activist Insight, which specializes in same time, from two to 23. Due to pressure from investors, providing unmatched intelligence to professionals in the global an increasing number of companies have adopted proxy activist investment space. Activist Insight was founded in 2012 access rules, which has led to less demand for proxy access by Nick Arnott and Kerry Pogue. For more information, visit proposals. However, some shareholders believe the company- www.proxyinsight.com. adopted proposals are unnecessarily restrictive. Consequently, some investors have sponsored measures to fix or modify Acknowledgements: the company-adopted proposal to make it more shareholder- > Seon Barbera, Computershare friendly. In contrast to certain other types of shareholder- > Nathan Busch, Computershare sponsored proposals discussed above, individual shareholders are often the sponsors of the fix-it proposals, rather than > Don Cassidy, Georgeson institutional investors. Please see figure 7, ”Proposals Relating to > Nick Dawson, Proxy Insight Proxy Access – 2016 and 2017” for more detail. > Seth Duppstadt, Proxy Insight About Georgeson > Rajeev Kumar, Georgeson Established in 1935, Georgeson is the world’s foremost > Michael Maiolo, Georgeson provider of strategic shareholder services to corporations and > Aaron Miller, Georgeson shareholder groups working to influence corporate strategy. > Brigid Cremin Rosati, Georgeson We offer unsurpassed advice and representation for annual > Conor Sheehan, Georgeson meetings, mergers and acquisitions, proxy contests and other extraordinary transactions. Our core proxy expertise Availability of Georgeson’s Database for Academic is enhanced with and complemented by our strategic Research and Other Purposes consulting services, including solicitation strategy, shareholder With more than 30 years of historical information related to U.S. identification, corporate governance analysis, vote projections shareholder proposals and corporate governance matters, we and insight into investor ownership and voting profiles. Our local have a uniquely comprehensive database of shareholder activity. presence and global footprint allow us to analyze and mitigate We would be happy to collaborate with interested parties and operational risk associated with various corporate actions academics who wish to leverage this historical database. worldwide. For more information, visit www.georgeson.com. 2017 Annual Corporate Governance Review > 5 Methodology For the research and data collection for the Annual Corporate Governance Review this year, Georgeson partnered with Proxy Insight. Management and Shareholder