Tyson Foods will host its annual shareholder meeting virtually on Thursday (Feb. 11), marking the first time in the company’s 57-year history as a publicly traded company a physical meeting won’t be held.
Tyson noted in its proxy filing with the U.S. Securities and Exchange Commission that shareholders are asked to elect a slate of 15 directors, ratify the selection of PricewaterhouseCoopers LLP as the independent registered public accounting firm for the year ending Oct. 2, 2021, approve an amendment to the company’s 2000 Stock Incentive Plan and vote against three proposals made by shareholder groups.
Tyson expanded its board of directors from 12 to 15 in the past year. Maria Claudia Borras was chosen by the company through a third-party search process last year and she is the only director that has not already been seated in prior years. Board Chairman John H. Tyson also added an executive vice chairman last year appointing Noel White to that position when he retired as CEO.
In addition to Borras, Tyson and White, following are other directors standing for re-election: Les Baledge, former general counsel for Tyson Foods prior to his 1999 retirement; Gaurdie Banister, a board member since 2011; Dean Banks, CEO of Tyson Foods and board member since 2017; former Arkansas Gov. Mike Beebe, a board member since 2015; David Bronczek, former FedEx executive who joined the board in 2020; Mikel Durham, CEO of American Seafoods Group and director since 2015; Jonathan Mariner, former exec of Major League Baseball and Walt Disney, board member since 2010; Kevin McNamara, venture capitalist and board member since 2007; Cheryl Miller, financial executive in the automotive industry and board member since 2016; Jeffrey Schomburger, retired executive from Procter & Gamble and board member since 2016; Robert Thurber, retired Sysco executive and board member since 2009; and Barbara Tyson, former Tyson executive and board member since 1988.
The three shareholder proposals Tyson’s board has asked shareholders to not approve are repeat requests from former years. There is a proposal for Tyson Foods to report on its efforts to address human rights. The group cites Tyson’s lackluster worker safety record with plant accidents prior to the COVID-19 pandemic which has resulted in at least 6 worker deaths in 2020. Tyson responded to that request saying the company disagreed with implications raised in the proposal.
A separate group wants the company to dissolve its dual class system allowing for all shareholders to have equal voting rights. The Tyson family now holds 100% of the company’s Class A shares that have a 10 to 1 voting privilege over Class B shares which trade publicly on the New York Stock Exchange. The group claims it’s unfair to shareholders and impossible to get proposals passed because the family can block any proposal they chose with their enhanced voting power.
The board responded by saying the dual-class system is in the best interest of the company and all shareholders. The two-class system has been in place since the company went public in 1986 and the board said is part of the reason so many investors are attracted to the stock as they see the family interest and involvement as a benefit to the long-term stability of the company.
Lastly, shareholders asked for a full disclosure on Tyson’s direct and indirect lobbying activities. The group said more transparency is needed as to the spending which included $15.7 million on federal lobbying from 2010 to 2019. They said that excludes state lobbying expenditures.
“Tyson has drawn attention for leading the lobbying effort to have the meat industry labeled critical infrastructure as slaughterhouses became coronavirus hot spots. Approximately 60% of the independent shareholders voted for this proposal at the 2020 annual meeting,” the group noted in the Proxy filing.
Tyson said the proposal overstates the actual amount the company paid for certain lobbying activities and the focus of the proposal appears to be on ensuring the transparency and accountability of the company’s lobbying and political activities.
Also on Thursday, Tyson Foods will report its fiscal 2021 first-quarter earnings results ahead of the market opening. Tyson shares (NYSE: TSN) have tumbled more than 17% in value from a year ago. Most of that loss occurred in mid-March when shares tumbled more than 40% to the low $42 range from the 52-week high of $83. Tyson shares have stalled in the $60 range through most of 2020.