Fund |
Class
S |
Class
A |
Thrivent
Aggressive Allocation Fund |
TAAIX |
TAAAX |
Thrivent
Balanced Income Plus Fund |
IBBFX |
AABFX |
Thrivent
Diversified Income Plus Fund |
THYFX |
AAHYX |
Thrivent
Global Stock Fund |
IILGX |
AALGX |
Thrivent
Government Bond Fund |
TBFIX |
TBFAX |
Thrivent
High Income Municipal Bond Fund |
THMBX |
-- |
Thrivent
High Yield Fund |
LBHIX |
LBHYX |
Thrivent
Income Fund |
LBIIX |
LUBIX |
Thrivent
International Allocation Fund |
TWAIX |
TWAAX |
Thrivent
Large Cap Growth Fund |
THLCX |
AAAGX |
Thrivent
Large Cap Value Fund |
TLVIX |
AAUTX |
Thrivent
Limited Maturity Bond Fund |
THLIX |
LBLAX |
Thrivent
Low Volatility Equity Fund |
TLVOX |
-- |
Thrivent
Mid Cap Growth Fund |
TMCGX |
-- |
Thrivent
Mid Cap Stock Fund |
TMSIX |
AASCX |
Thrivent
Mid Cap Value Fund |
TMCVX |
-- |
Thrivent
Moderate Allocation Fund |
TMAIX |
THMAX |
Thrivent
Moderately Aggressive Allocation Fund |
TMAFX |
TMAAX |
Thrivent
Moderately Conservative Allocation Fund |
TCAIX |
TCAAX |
Thrivent
Money Market Fund |
AALXX |
AMMXX |
Thrivent
Multidimensional Income Fund |
TMLDX |
-- |
Thrivent
Municipal Bond Fund |
TMBIX |
AAMBX |
Thrivent
Opportunity Income Plus Fund |
IIINX |
AAINX |
Thrivent
Small Cap Growth Fund |
TSCGX |
-- |
Thrivent
Small Cap Stock Fund |
TSCSX |
AASMX |
Fund
Name |
Class
S
Inception
Date |
Class
A
Inception
Date |
Thrivent
Aggressive Allocation Fund |
6/30/2005 |
6/30/2005 |
Thrivent
Balanced Income Plus Fund |
12/29/1997 |
12/29/1997 |
Thrivent
Diversified Income Plus Fund |
12/29/1997 |
1/08/1997 |
Thrivent
Global Stock Fund |
12/29/1997 |
7/16/1987 |
Thrivent
Government Bond Fund |
2/26/2010 |
2/26/2010 |
Thrivent
High Income Municipal Bond Fund |
2/28/2018 |
N/A |
Thrivent
High Yield Fund |
10/31/1997 |
4/3/1987 |
Thrivent
Income Fund |
10/31/1997 |
6/1/1972 |
Thrivent
International Allocation Fund |
2/29/2008 |
2/29/2008 |
Thrivent
Large Cap Growth Fund |
10/29/1999 |
10/29/1999 |
Thrivent
Large Cap Value Fund |
10/29/1999 |
10/29/1999 |
Thrivent
Limited Maturity Bond Fund |
10/29/1999 |
10/29/1999 |
Thrivent
Low Volatility Equity Fund |
2/28/2017 |
N/A |
Thrivent
Mid Cap Growth Fund |
2/28/2020 |
N/A |
Thrivent
Mid Cap Stock Fund |
12/29/1997 |
6/30/1993 |
Thrivent
Mid Cap Value Fund |
2/28/2020 |
N/A |
Thrivent
Moderate Allocation Fund |
6/30/2005 |
6/30/2005 |
Thrivent
Moderately Aggressive Allocation Fund |
6/30/2005 |
6/30/2005 |
Thrivent
Moderately Conservative Allocation Fund |
6/30/2005 |
6/30/2005 |
Thrivent
Money Market Fund |
12/29/1997 |
3/10/1988 |
Thrivent
Multidimensional Income Fund |
2/28/2017 |
N/A |
Thrivent
Municipal Bond Fund |
10/31/1997 |
12/3/1976 |
Thrivent
Opportunity Income Plus Fund |
12/29/1997 |
7/16/1987 |
Thrivent
Small Cap Growth Fund |
2/28/2018 |
N/A |
Thrivent
Small Cap Stock Fund |
12/29/1997 |
7/01/1996 |
Service
Provider |
Service |
Frequency | |
Bloomberg |
Trading
System |
Daily |
|
Bloomberg
BVAL |
Pricing
Service |
Daily |
|
Callan
Associates |
Consultant |
Quarterly;
1-day lag |
|
Cambridge
Associates, LLC |
Consultant |
Quarterly |
|
Confluence |
Regulatory
Reporting
Vendor |
Monthly |
|
Service
Provider |
Service |
Frequency | |
Donnelley
Financial Solutions, Inc. |
Regulatory
Printer |
Quarterly |
|
Donnelley
Financial Solutions, Inc. |
Website
Content |
Monthly |
|
DTCC |
Trade
Matching
Platform |
Daily |
|
Ernst
and Young |
PFIC
analysis |
Quarterly |
|
eVestment
(Omni) |
Institutional
Database |
Monthly/Quarterly |
|
FactSet
Research Systems Inc. |
Systems
Vendor |
Daily |
|
Fidelity
National Information Services, Inc. |
Mutual
Fund
Accounting
System
Vendor |
Daily |
|
Fidelity
National Information Services, Inc. |
Personal
Trading
System
Vendor |
Daily |
|
Goldman
Sachs Asset Management, L.P. |
Investment
Subadviser |
Daily |
|
Goldman
Sachs Bank USA |
Securities
Lending
Agent |
Daily |
|
ICE
Data Services |
Pricing
Service |
Daily |
|
IHS
Markit |
Pricing
Service |
Daily |
|
IHS
Markit |
Bank
Loan Settlement
Tools |
Daily |
|
Institutional
Shareholder Services |
Proxy
Voting &
Class
Action Services
Vendor |
Daily |
|
ITG
Inc. |
Systems
Vendor |
Daily |
|
Lipper |
Data
Vendor |
Monthly;
1-day lag |
|
Morningstar,
Inc. |
Data
Vendor |
Monthly;
60-day lag |
|
PricewaterhouseCoopers
LLP |
Independent
Registered
Public
Accounting
Firm |
Annually |
|
PricingDirect
Inc. |
Pricing
Service |
Daily |
|
SS&C |
Marketing
Collateral
System |
Monthly;
5-day lag |
|
State
Street Bank and Trust Company |
Bank
Loan Servicing |
Daily |
|
State
Street Bank and Trust Company |
Custodian |
Daily |
|
State
Street Bank and Trust Company |
Systems
Vendor |
Daily |
|
VMLY&R |
Website
Consultant |
Monthly |
|
Wolters
Kluwer |
Systems
Vendor |
Monthly;
3-day lag |
|
Name,
Address and
Year
of Birth (2)
|
Position
with
Trust
and
Length
of
Service (3)
|
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Trustee |
Principal
Occupation
During
Past 5 Years |
Other
Directorships
Held
Currently
and
within Past
Five
Years |
Michael
W. Kremenak
(1978) |
President
since
2023;
Trustee
since
2021 |
67 |
Senior
Vice President and Head
of
Mutual Funds, Thrivent since
2020;
Vice President, Thrivent
from
2015 to 2020 |
None |
David
S. Royal
(1971) |
Chief
Investment
Officer
since
2017;
Trustee
since
2015 |
67 |
Chief
Financial Officer, Thrivent
since
2022; Executive Vice
President,
Chief Investment
Officer,
Thrivent since 2017;
President,
Mutual Funds from
2015
to 2023 |
Currently,
Director of
Thrivent
Trust
Company
and
Advisory
Board
Member
of Twin
Bridge
Capital
Partners |
Name,
Address and
Year
of Birth (2)
|
Position
with
Trust
and
Length
of
Service (3)
|
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Trustee |
Principal
Occupation
During
the Past 5 Years |
Other
Directorships
Held
Currently
and
within Past
Five
Years |
Janice
B. Case
(1952) |
Trustee
since
2011 |
66 |
Retired |
Independent
Trustee
of
North American
Electric
Reliability
Corporation
from
2008
to 2020 |
Robert
J. Chersi
(1961) |
Trustee
since
2017 |
66 |
Founder
of Chersi Services LLC
(consulting
firm) since 2014 |
Director
and member
of
the Audit and Risk
Oversight
Committees
of
E*TRADE
Financial
Corporation
and
Director
of E*TRADE
Bank
from 2019 to
2020;
Lead
Independent
Director
since
2019 and
Director
and Audit
Committee
Chair at
BrightSphere
Investment
Group
plc
since 2016 |
Arleas
Upton Kea
(1957) |
Trustee
since
2022 |
66 |
Deputy
to the Chairman for
External
Affairs, FDIC in 2021;
Chief
Operating Officer and
Deputy
to the Chairman, FDIC
from
2018 to 2021; Director,
Administration,
FDIC from 1999
to
2018 |
Board
of Directors,
Combined
Federal
Campaign
of the
National
Capital Area
since
2021; Board of
Directors,
University
of
Texas Alumni
Association
since
2021;
Board of
Directors,
University
of
Texas Law School
Foundation
since
2021 |
Paul
R. Laubscher
(1956) |
Trustee
since
2009 |
66 |
Portfolio
Manager for U.S. private
real
estate and equity and global
public
equity portfolios, hedge
funds
and currency of IBM
Retirement
Funds from 1997 to
2022 |
None |
Name,
Address and
Year
of Birth (2) |
Position
with
Trust
and
Length
of
Service (3) |
Number
of
Portfolios
in
Fund
Complex
Overseen
by
Trustee |
Principal
Occupation
During
the Past 5 Years |
Other
Directorships
Held
Currently
and
within Past
Five
Years |
Robert
J. Manilla
(1962) |
Trustee
since
2022 |
66 |
Vice
President and Chief
Investment
Officer, The Kresge
Foundation
since 2007 |
Board
Member of
Bedrock
Manufacturing
Company
since
2014;
Board Member
of
Sustainable
Insight
Capital
Management
LLC
from
2013 to 2022;
Board
Member of
Venture
Michigan
Fund
from 2016 to
2020;
Board Member
of
McGowan
Charitable
fund from
2012
to 2019 |
James
A. Nussle
(1960) |
Trustee
since
2011 |
66 |
President
and Chief Executive
Officer
of Credit Union National
Association
since
September
2014; Director of
Portfolio
Recovery Associates
(PRAA)
since 2010; CEO of The
Nussle
Group LLC (consulting
firm)
since 2009 |
None |
James
W. Runcie
(1963) |
Trustee
since
2022 |
66 |
Co-Founder
and CEO of
Partnership
for Education
Advancement
since 2017 |
Board
Member of
Follett
Higher
Education
since
2022;
Director and
Audit
Committee
Chair
of
Class
Acceleration
Corporation
since
2021;
Board Member
of
ECMC Group
since
2021 |
Constance
L. Souders
(1950) |
Trustee
since
2007 |
66 |
Retired |
None |
Name,
Address and
Year
of Birth(2)
|
Position
with
Trust
and
Length
of
Service(3)
|
Principal
Occupation
During
the Past 5 Years |
Michael
W. Kremenak
(1978) |
President
since 2023;
Trustee
since 2021 |
Senior
Vice President and Head of Mutual Funds, Thrivent since
2020;
Vice President, Thrivent from 2015 to
2020 |
Name,
Address and
Year
of Birth(2) |
Position
with
Trust
and
Length
of
Service(3) |
Principal
Occupation
During
the Past 5 Years |
David
S. Royal
(1971) |
Chief
Investment
Officer
since 2017;
Trustee
since 2015 |
Chief
Financial Officer, Thrivent since 2022; Executive Vice President,
Chief
Investment Officer, Thrivent since 2017; President, Mutual
Funds
from 2015 to 2023 |
Sarah
L. Bergstrom
(1977) |
Treasurer
and
Principal
Accounting
Officer
since 2022 |
Vice
President, Chief Accounting Officer/Treasurer - Mutual Funds,
Thrivent
since 2022; Head of Mutual Fund Accounting, Thrivent from
2017
to 2022 |
Edward
S. Dryden
(1965) |
Chief
Compliance
Officer
since 2010 |
Vice
President, Chief Compliance Officer – Thrivent Funds, Thrivent
since
2018; Director, Chief Compliance Officer – Thrivent Funds,
Thrivent
from 2010 to 2018 |
John
D. Jackson
(1977) |
Secretary
and Chief
Legal
Officer since
2020 |
Senior
Counsel, Thrivent since 2017 |
Kathleen
M. Koelling(5)
(1977) |
Privacy
Officer since
2011 |
Vice
President, Deputy General Counsel, Thrivent since 2018; Privacy
Officer,
Thrivent since 2011; Anti-Money Laundering Officer, Thrivent
from
2011 to 2019; Vice President, Managing Counsel, Thrivent from
2016
to 2018 |
Sharon
K. Minta(5)
(1973) |
Anti-Money
Laundering
Officer
since
2019 |
Director,
Compliance and Anti-Money Laundering Officer of the
Financial
Crimes Unit, Thrivent since 2019; Compliance Manager of
the
Financial Crimes Unit, Thrivent from 2014 to 2019 |
Troy
A. Beaver
(1967) |
Vice
President since
2016 |
Vice
President, Mutual Funds Marketing & Distribution, Thrivent since
2015 |
Monica
L. Kleve
(1969) |
Vice
President since
2019 |
Vice
President, Investment Operations, Thrivent since 2019; Director,
Investments
Systems and Solutions, Thrivent from 2002 to 2019 |
Andrew
R. Kellogg(6)
(1972) |
Vice
President since
2022 |
Director
of Strategic Partnerships, Thrivent since 2021; Director,
Client
Relations, SS&C/DST Systems, Inc. from 2016 to
2021 |
Jill
M. Forte
(1974) |
Assistant
Secretary
since
2016 |
Senior
Counsel, Thrivent since 2017 |
Richard
L. Ramczyk(5)
(1976) |
Assistant
Treasurer
since
2022 |
Director,
Fund Accounting and Valuation, Thrivent since 2022;
Manager,
Mutual Fund Accounting Operations, Thrivent from 2011 to
2022 |
Taishiro
A. Tezuka
(1985) |
Assistant
Treasurer
since
2023 |
Director,
Fund Administration, Thrivent since 2023; Director, Asset
Wealth
Management, PricewaterhouseCoopers LLP from 2020 to
2022;
Senior Manager, Asset Wealth Management,
PricewaterhouseCoopers
LLP from 2019 to 2020; Manager, Asset
Wealth
Management, PricewaterhouseCoopers LLP from 2016 to
2019 |
Name
of Trustee |
Dollar
Range of Beneficial Ownership in the Funds |
Aggregate
Dollar
Range
of Beneficial
Ownership
in All
Registered
Investment
Companies
Overseen
by
the Trustee
in
the Family of
Investment
Companies | |
Michael
W. Kremenak |
Thrivent
Aggressive Allocation Fund |
$50,001-$100,000 |
Over
$100,000 |
|
Thrivent
Limited Maturity Bond Fund |
Over
$100,000 |
|
|
Thrivent
Mid Cap Stock Fund |
$10,001-$50,000 |
|
|
Thrivent
Small Cap Growth Fund |
$10,001-$50,000 |
|
|
Thrivent
Small Cap Stock Fund |
Over
$100,000 |
|
David
S. Royal |
Thrivent
Aggressive Allocation Fund |
Over
$100,000 |
Over
$100,000 |
|
Thrivent
Income Fund |
Over
$100,000 |
|
|
Thrivent
Large Cap Growth Fund |
$10,001-$50,000 |
|
|
Thrivent
Large Cap Value Fund |
$50,001-$100,000 |
|
|
Thrivent
Mid Cap Growth Fund |
$10,001-$50,000 |
|
|
Thrivent
Mid Cap Stock Fund |
Over
$100,000 |
|
|
Thrivent
Small Cap Growth Fund |
Over
$100,000 |
|
|
Thrivent
Small Cap Stock Fund |
$50,001-$100,000 |
|
Name
of Trustee |
Dollar
Range of Beneficial Ownership in the Funds |
Aggregate
Dollar
Range
of Beneficial
Ownership
in All
Registered
Investment
Companies
Overseen
by
the Trustee
in
the Family of
Investment
Companies | |
Janice
B. Case |
Thrivent
Aggressive Allocation Fund |
$50,001-$100,000 |
Over
$100,000 |
|
Thrivent
Diversified Income Plus Fund |
$10,001-$50,000 |
|
|
Thrivent
High Yield Fund |
$10,001-$50,000 |
|
|
Thrivent
International Allocation Fund |
$1-$10,000 |
|
Name
of Trustee |
Dollar
Range of Beneficial Ownership in the Funds |
Aggregate
Dollar
Range
of Beneficial
Ownership
in All
Registered
Investment
Companies
Overseen
by
the Trustee
in
the Family of
Investment
Companies | |
|
Thrivent
Moderate Allocation Fund |
$10,001-$50,000 |
|
|
Thrivent
Moderately Aggressive Allocation Fund |
$1-$10,000 |
|
|
Thrivent
Municipal Bond Fund |
$10,001-$50,000 |
|
Robert
J. Chersi |
Thrivent
Aggressive Allocation Fund |
$50,001-$100,000 |
Over
$100,000 |
|
Thrivent
Diversified Income Plus Fund |
$50,001-$100,000 |
|
|
Thrivent
Mid Cap Stock Fund |
$50,001-$100,000 |
|
|
Thrivent
Moderately Aggressive Allocation Fund |
$50,001-$100,000 |
|
Arleas
Upton Kea |
Thrivent
Large Cap Growth Fund |
$10,001-$50,000 |
$10,001-$50,000 |
|
Thrivent
Large Cap Value Fund |
$10,001-$50,000 |
|
|
Thrivent
Small Cap Stock Fund |
$10,001-$50,000 |
|
Paul
R. Laubscher |
Thrivent
Moderately Aggressive Allocation Fund |
Over
$100,000 |
Over
$100,000 |
Robert
J. Manilla |
Thrivent
Aggressive Allocation Fund |
Over
$100,000 |
Over
$100,000 |
|
Thrivent
Mid Cap Stock Fund |
$10,001-$50,000 |
|
James
A. Nussle |
Thrivent
Diversified Income Plus Fund |
$10,001-$50,000 |
Over
$100,000 |
|
Thrivent
International Allocation Fund |
$50,001-$100,000 |
|
|
Thrivent
Large Cap Value Fund |
Over
$100,000 |
|
|
Thrivent
Mid Cap Stock Fund |
Over
$100,000 |
|
|
Thrivent
Small Cap Stock Fund |
$50,001-$100,000 |
|
James
W. Runcie |
Thrivent
Large Cap Value Fund |
Over
$100,000 |
Over
$100,000 |
|
Thrivent
Mid Cap Stock Fund |
$1-$10,000 |
|
Constance
L.
Souders |
Thrivent
Moderately Aggressive Allocation Fund |
Over
$100,000 |
Over
$100,000 |
Name
of Trustee(1)
|
Aggregate
Compensation
from
Trust
for One Year
Ending
October 31, 2022 |
Total
Compensation
Paid
by Trust and
Fund
Complex
for
One Year
Ending
October 31, 2022 |
Janice
B. Case |
$116,487 |
$285,000 |
Robert
J. Chersi |
$124,668 |
$305,000 |
Arleas
Upton Kea |
$102,245 |
$250,000 |
Paul
R. Laubscher |
$157,500 |
$385,000 |
Robert
J. Manilla |
$70,068 |
$170,000 |
James
A. Nussle |
$116,487 |
$285,000 |
James
W. Runcie |
$102,245 |
$250,000 |
Constance
L. Souders |
$116,487 |
$285,000 |
Fund |
Shareholder |
Percent
Owned |
Thrivent
Aggressive Allocation Fund – Class S |
EMPOWER
TRUST
THRIVENT
401k
8525
E ORCHARD RD
GREENWOOD
VLG CO 80111-5009 |
10.05% |
Thrivent
Diversified Income Plus Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
9.20% |
Thrivent
Global Stock Fund - Class S |
THRIVENT
MODERATELY AGGRESSIVE
ALLOCATION
FUND |
9.57% |
Thrivent
Government Bond Fund – Class S |
THRIVENT
CHARITABLE IMPACT & INVESTING
PO
BOX 8072
APPLETON
WI 54912-8072 |
62.81% |
|
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
16.21% |
Thrivent
High Income Municipal Bond Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-1995 |
27.81% |
Thrivent
High Yield Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
16.50% |
|
THRIVENT
MODERATE ALLOCATION FUND |
5.88% |
Fund |
Shareholder |
Percent
Owned |
Thrivent
Income Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
20.83% |
|
THRIVENT
MODERATE ALLOCATION FUND |
13.06% |
|
THRIVENT
MODERATELY CONSERVATIVE
ALLOCATION
FUND |
7.97% |
|
THRIVENT
MODERATELY AGGRESSIVE
ALLOCATION
FUND |
7.22% |
|
EMPOWER
TRUST FBO
THRIVENT
401K
8525
E ORCHARD RD
GREENWOOD
VLG CO 80111-5002 |
6.61% |
Thrivent
International Allocation Fund - Class S |
THRIVENT
MODERATELY AGGRESSIVE
ALLOCATION
FUND |
31.00% |
|
THRIVENT
MODERATE ALLOCATION FUND |
16.62% |
|
THRIVENT
AGGRESSIVE ALLOCATION FUND |
16.11% |
|
THRIVENT
FINANCIAL FOR LUTHERANS
%
HR EMPLOYEE BENEFITS DEPT #7950
4321
N BALLARD RD
APPLETON
WI 54919-0001 |
9.47% |
Thrivent
Large Cap Growth Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
21.13% |
|
THRIVENT
MODERATELY AGGRESSIVE
ALLOCATION
FUND |
16.79% |
|
THRIVENT
MODERATE ALLOCATION FUND |
13.22% |
|
THRIVENT
AGGRESSIVE ALLOCATION FUND |
7.55% |
Thrivent
Large Cap Value Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
30.56% |
|
THRIVENT
MODERATELY AGGRESSIVE
ALLOCATION
FUND |
17.27% |
|
THRIVENT
MODERATE ALLOCATION FUND |
14.70% |
Fund |
Shareholder |
Percent
Owned |
|
THRIVENT
AGGRESSIVE ALLOCATION FUND |
5.28% |
Thrivent
Limited Maturity Bond Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
38.81% |
Thrivent
Low Volatility Equity Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
13.91% |
Thrivent
Mid Cap Stock Fund - Class S |
NATIONAL
FINANCIAL SERVICES CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
499
WASHINGTON BLVD, FL 5
JERSEY
CITY, NJ 07310-2010 |
18.10% |
|
CHARLES
SCHWAB & CO INC.
SPECIAL
CUSTODY A/C FBO CUSTOMERS
211
MAIN STREET
SAN
FRANCISCO, CA 94105-1905 |
6.84% |
|
THRIVENT
MODERATELY AGGRESSIVE
ALLOCATION
FUND |
6.29% |
Thrivent
Multidimensional Income Fund - Class S |
NATIONAL
FINANCIAL SERVICES CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
499
WASHINGTON BLVD, FL 4
JERSEY
CITY, NJ 07310-1995 |
35.55% |
Thrivent
Municipal Bond Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2010 |
13.82% |
Thrivent
Opportunity Income Plus Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 5
JERSEY
CITY NJ 07310-2017 |
45.93% |
Thrivent
Small Cap Growth Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 4
JERSEY
CITY NJ 07310-1995 |
66.88% |
Fund |
Shareholder |
Percent
Owned |
Thrivent
Small Cap Stock Fund - Class S |
NATIONAL
FINANCIAL SVCS CORP FOR
EXCLUSIVE
BENEFIT OF OUR CUSTOMERS
FBO
499
WASHINGTON BLVD FL 4
JERSEY
CITY NJ 07310-1995 |
18.88% |
|
CHARLES
SCHWAB & CO INC
SPECIAL
CUSTODY A/C FBO CUSTOMERS
ATTN
MUTUAL FUNDS
211
MAIN ST
SAN
FRANCISCO CA 94105-1905 |
9.27% |
|
PERSHING
LLC
PO
BOX 2052
JERSEY
CITY NJ 07303-2052 |
7.11% |
|
AMERICAN
ENTERPRISE INVESTMENT SVC
FBO
#41999970
707
2ND
AVE SO
MINNEAPOLIS
MN 55402-2405 |
6.21% |
|
Other
Registered
Investment
Companies (1)
|
Other
Accounts | ||
Portfolio
Manager |
#
of Accounts
Managed |
Assets
Managed |
#
of Accounts
Managed |
Assets
Managed |
Johan
A. Akesson |
0 |
$0 |
0 |
$0 |
Brian
W. Bomgren (2) |
10 |
$6,355,525,679 |
2 |
$484,496,371 |
Lauri
A. Brunner |
2 |
$3,071,218,078 |
2 |
$258,852,165 |
Matthew
D. Finn
( 7) |
4 |
$1,595,960,643 |
3 |
$70,555,620 |
Brian
J. Flanagan |
1 |
$2,080,005,679 |
2 |
$125,316,771 |
Jon-Paul
(JP) Gagne |
2 |
$974,212,284 |
0 |
$0 |
Nicholas
E. Griffith |
1 |
$49,498,345 |
0 |
$0 |
Michael
P. Hubbard |
0 |
$0 |
1 |
$46,878,188 |
Vikram
Kaura |
1 |
$2,080,005,679 |
0 |
$0 |
Kurt
J. Lauber |
2 |
$3,682,561,427 |
2 |
$348,310,003 |
David
J. Lettenberger |
2 |
$147,446,564 |
1 |
$46,878,188 |
Thomas
C. Lieu |
1 |
$2,442,496,772 |
1 |
$209,612,966 |
Stephen
D. Lowe (3) |
8 |
$22,742,316,861 |
1 |
$85,606,270 |
J.P.
McKim |
1 |
$2,080,005,679 |
0 |
$0 |
Noah
J. Monsen (2) |
6 |
$4,523,721,374 |
2 |
$484,496,371 |
Paul
J. Ocenasek |
1 |
$716,997,076 |
2 |
$3,566,965,947 |
David
S. Royal |
4 |
$21,403,038,071 |
0 |
$0 |
Siddharth
Sinha |
2 |
$147,446,564 |
1 |
$46,878,188 |
|
Other
Registered
Investment
Companies (1) |
Other
Accounts | ||
Portfolio
Manager |
#
of Accounts
Managed |
Assets
Managed |
#
of Accounts
Managed |
Assets
Managed |
Jaimin
Soni |
1 |
$1,831,153,424 |
1 |
$167,506,453 |
David
R. Spangler |
7 |
$23,740,571,685 |
1 |
$43,843,802 |
William
D. Stouten (4) |
3 |
$5,028,090,811 |
2 |
$1,458,438,690 |
Cortney
L. Swensen |
1 |
$807,212,437 |
0 |
$0 |
James
M. Tinucci |
1 |
$873,264,486 |
1 |
$20,469,960 |
Kent
L. White (5) |
3 |
$1,449,368,654 |
1 |
$85,606,270 |
Theron
G. Whitehorn (
6) |
4 |
$1,339,278,789 |
1 |
$212,814,276 |
Graham
Wong |
1 |
$49,498,345 |
0 |
$0 |
Portfolio
Manager |
Fund |
Fund
Ownership |
Portfolio
(1)
|
Portfolio
Ownership |
Ownership
in
Fund
Complex (2)
|
Johan
A.
Akesson |
Thrivent
High Income Municipal
Bond
Fund |
$10,001-$50,0000 |
|
|
$100,001-$500,000 |
|
Thrivent
Municipal Bond Fund |
$10,001-$50,0000 |
|
|
|
Brian
W.
Bomgren |
Thrivent
International Allocation
Fund |
None |
Thrivent
International Allocation
Portfolio |
None |
$50,001-$100,000 |
|
Thrivent
Low Volatility Equity
Fund |
None |
Thrivent
Low Volatility Equity
Portfolio |
None |
|
Lauri
Brunner |
Thrivent
Global Stock Fund |
None |
Thrivent
Global Stock Portfolio |
None |
$100,001-$500,000 |
|
Thrivent
Large Cap Growth Fund |
$10,001-$50,0000 |
Thrivent
Large Cap Growth
Portfolio |
None |
|
Nick
Cai(3)
|
Thrivent
International Allocation
Fund |
None |
Thrivent
International Allocation
Portfolio |
None |
None |
Matthew
D.
Finn |
Thrivent
Small Cap Stock Fund |
$500,001-$1,000,000 |
Thrivent
Small Cap Stock
Portfolio |
None |
$500,001-$1,000,000 |
Brian
J.
Flanagan |
Thrivent
Mid Cap Stock Fund |
$500,001-$1,000,000 |
Thrivent
Mid Cap Stock Portfolio |
$1-$10,000 |
Over
$1,000,000 |
Jon-Paul
(JP)
Gagne |
Thrivent
Government Bond Fund |
None |
Thrivent
Government Bond
Portfolio |
None |
$100,001-$500,000 |
|
Thrivent
Limited Maturity Bond
Fund |
None |
Thrivent
Limited Maturity Bond
Portfolio |
None |
|
Nicholas
E.
Griffith |
Thrivent
Mid Cap Value Fund |
None |
Thrivent
Mid Cap Value Portfolio |
None |
$10,001-$50,0000 |
Portfolio
Manager |
Fund |
Fund
Ownership |
Portfolio
(1) |
Portfolio
Ownership |
Ownership
in
Fund
Complex (2) |
Michael
P.
Hubbard |
Thrivent
Mid Cap Growth Fund |
None |
Thrivent
Mid Cap Growth
Portfolio |
None |
$100,001-$500,000 |
|
Thrivent
Small Cap Growth Fund |
None |
Thrivent
Small Cap Growth
Portfolio |
None |
|
Vikram
Kaura |
Thrivent
Mid Cap Stock Fund |
None |
Thrivent
Mid Cap Stock Portfolio |
None |
$100,001-$500,000 |
Kurt
J.
Lauber |
Thrivent
Global Stock Fund |
None |
Thrivent
Global Stock Portfolio |
None |
$500,001-$1,000,000 |
|
Thrivent
Large Cap Value Fund |
$100,001-$500,000 |
Thrivent
Large Cap Value
Portfolio |
None |
|
David
J.
Lettenberger |
Thrivent
Mid Cap Growth Fund |
None |
Thrivent
Mid Cap Growth
Portfolio |
None |
$500,001-$1,000,000 |
|
Thrivent
Small Cap Growth Fund |
None |
Thrivent
Small Cap Growth
Portfolio |
None |
|
Thomas
C.
Lieu |
Thrivent
Large Cap Value Fund |
None |
Thrivent
Large Cap Value
Portfolio |
None |
$100,001-$500,000 |
Stephen
D.
Lowe |
Thrivent
Aggressive Allocation
Fund |
$100,001-$500,000 |
Thrivent
Aggressive Allocation
Portfolio |
None |
Over
$1,000,000 |
|
Thrivent
Balanced Income Plus
Fund |
$10,001-$50,0000 |
Thrivent
Balanced Income Plus
Portfolio |
None |
|
|
Thrivent
Diversified Income Plus
Fund |
$10,001-$50,0000 |
Thrivent
Diversified Income Plus
Portfolio |
None |
|
|
Thrivent
Moderate Allocation
Fund |
$500,001-$1,000,000 |
Thrivent
Moderate Allocation
Portfolio |
$100,001-$500,000 |
|
|
Thrivent
Moderately Aggressive
Allocation
Fund |
$500,001-$1,000,000 |
Thrivent
Moderately Aggressive
Allocation
Portfolio |
None |
|
|
Thrivent
Moderately Conservative
Allocation
Fund |
None |
Thrivent
Moderately Conservative
Allocation
Portfolio |
None |
|
|
Thrivent
Multidimensional Income
Fund |
None |
Thrivent
Multidimensional Income
Portfolio |
None |
|
|
Thrivent
Opportunity Income Plus
Fund |
$10,001-$50,0000 |
Thrivent
Opportunity Income Plus
Portfolio |
None |
|
J.P.
McKim |
Thrivent
Mid Cap Stock Fund |
$50,000-$100,000 |
Thrivent
Mid Cap Stock Portfolio |
None |
$100,001-$500,000 |
Noah
J.
Monsen |
Thrivent
Global Stock Fund |
$10,001-$50,000 |
Thrivent
Global Stock Portfolio |
None |
$500,001-$1,000,000 |
|
Thrivent
International Allocation
Fund |
None |
Thrivent
International Allocation
Portfolio |
None |
|
|
Thrivent
Low Volatility Equity
Fund |
None |
Thrivent
Low Volatility Equity
Portfolio |
None |
|
Paul
J.
Ocenasek |
Thrivent
High Yield Fund |
None |
Thrivent
High Yield Portfolio |
None |
Over
$1,000,000 |
David
S.
Royal |
Thrivent
Aggressive Allocation
Fund |
Over
$1,000,000 |
Thrivent
Aggressive Allocation
Portfolio |
$10,001-$50,000 |
Over
$1,000,000 |
|
Thrivent
Moderate Allocation
Fund |
None |
Thrivent
Moderate Allocation
Portfolio |
None |
|
|
Thrivent
Moderately Aggressive
Allocation
Fund |
None |
Thrivent
Moderately Aggressive
Allocation
Portfolio |
None |
|
|
Thrivent
Moderately Conservative
Allocation
Fund |
None |
Thrivent
Moderately Conservative
Allocation
Portfolio |
None |
|
Siddharth
Sinha |
Thrivent
Mid Cap Growth Fund |
None |
Thrivent
Mid Cap Growth
Portfolio |
None |
$100,001-$500,000 |
|
Thrivent
Small Cap Growth Fund |
None |
Thrivent
Small Cap Value Fund |
None |
|
Jaimin
Soni |
Thrivent
Large Cap Growth Fund |
None |
Thrivent
Large Cap Growth
Portfolio |
None |
$100,001-$500,000 |
Portfolio
Manager |
Fund |
Fund
Ownership |
Portfolio
(1) |
Portfolio
Ownership |
Ownership
in
Fund
Complex (2) |
David
R.
Spangler |
Thrivent
Aggressive Allocation
Fund |
$500,001-$1,000,000 |
Thrivent
Aggressive Allocation
Portfolio |
$1-$10,000 |
$500,001-$1,000,000 |
|
Thrivent
Balanced Income Plus
Fund |
None |
Thrivent
Balanced Income Plus
Portfolio |
None |
|
|
Thrivent
Diversified Income Plus
Fund |
None |
Thrivent
Diversified Income Plus
Portfolio |
None |
|
|
Thrivent
Global Stock Fund |
None |
Thrivent
Global Stock Portfolio |
None |
|
|
Thrivent
Moderate Allocation
Fund |
None |
Thrivent
Moderate Allocation
Portfolio |
None |
|
|
Thrivent
Moderately Aggressive
Allocation
Fund |
None |
Thrivent
Moderately Aggressive
Allocation
Portfolio |
None |
|
|
Thrivent
Moderately Conservative
Allocation
Fund |
$10,001-$50,000 |
Thrivent
Moderately Conservative
Allocation
Portfolio |
None |
|
William
D.
Stouten |
Thrivent
Money Market Fund |
None |
Thrivent
Money Market Portfolio |
None |
$100,001-$500,000 |
Cortney
L.
Swensen |
Thrivent
Income Fund |
None |
Thrivent
Income Portfolio |
None |
None |
|
Thrivent
Limited Maturity Bond
Fund |
None |
Thrivent
Limited Maturity Bond
Portfolio |
None |
|
James
M.
Tinucci |
Thrivent
Small Cap Stock Fund |
$500,001-$1,000,000 |
Thrivent
Small Cap Stock
Portfolio |
None |
Over
$1,000,000 |
Jing
Wang(3)
|
Thrivent
International Allocation
Fund |
None |
Thrivent
International Allocation
Portfolio |
None |
None |
|
Thrivent
Low Volatility Equity
Fund |
None |
|
|
|
Kent
L. White |
Thrivent
Government Bond Fund |
None |
Thrivent
Government Bond
Portfolio |
None |
$500,001-$1,000,000 |
|
Thrivent
Income Fund |
$100,001-$500,000 |
Thrivent
Income Portfolio |
None |
|
|
Thrivent
Multidimensional Income
Fund |
None |
Thrivent
Multidimensional Income
Portfolio |
None |
|
|
Thrivent
Opportunity Income Plus
Fund |
None |
Thrivent
Opportunity Income Plus
Portfolio |
None |
|
Theron
G.
Whitehorn |
Thrivent
Balanced Income Plus
Fund |
None |
Thrivent
Balanced Income Plus
Portfolio |
None |
$50,001-$100,000 |
|
Thrivent
Diversified Income Plus
Fund |
None |
Thrivent
Diversified Income Plus
Portfolio |
None |
|
|
Thrivent
Multidimensional Income
Fund |
None |
Thrivent
Multidimensional Income
Portfolio |
None |
|
|
Thrivent
Opportunity Income Plus
Fund |
None |
Thrivent
Opportunity Income Plus
Portfolio |
None |
|
Stephanie
L.
Woeppel |
Thrivent
High Income Municipal
Bond
Fund |
None |
|
|
None |
|
Thrivent
Municipal Bond Fund |
None |
|
|
|
Graham
Wong |
Thrivent
Mid Cap Value Fund |
$100,001-$500,000 |
Thrivent
Mid Cap Value Portfolio |
None |
$100,001-$500,000 |
Katelyn
R.
Young |
Thrivent
Small Cap Stock Fund |
None |
Thrivent
Small Cap Stock
Portfolio |
None |
$1-$10,000 |
Portfolio
Manager |
Type
of Accounts |
Total
#
of
Accounts
Managed |
Total
Assets
(in
millions) |
#
of Accounts
Managed
with
Advisory
Fee
Based
on
Performance |
Total
Assets
with
Advisory
Fee
Based on
Performance
(in
millions) |
Len
Ioffe |
Registered
Investment Companies: |
34 |
$19,079 |
0 |
$0 |
|
Other
Pooled Investment Vehicles:(1) |
22 |
$8,295 |
0 |
$0 |
|
Other
Accounts:(2) |
32 |
$7,215 |
1 |
$359 |
Osman
Ali |
Registered
Investment Companies: |
34 |
$19,079 |
0 |
$0 |
|
Other
Pooled Investment Vehicles:(1) |
22 |
$8,295 |
0 |
$0 |
|
Other
Accounts:(2) |
32 |
$7,215 |
1 |
$359 |
Takashi
Suwabe |
Registered
Investment Companies: |
34 |
$19,079 |
0 |
$0 |
|
Other
Pooled Investment Vehicles:(1) |
22 |
$8,295 |
0 |
$0 |
|
Other
Accounts:(2) |
32 |
$7,215 |
1 |
$359 |
Dennis
Walsh |
Registered
Investment Companies: |
34 |
$19,079 |
0 |
$0 |
|
Other
Pooled Investment Vehicles:(1) |
22 |
$8,295 |
0 |
$0 |
|
Other
Accounts:(2) |
32 |
$7,215 |
1 |
$359 |
Affiliated
Person |
Position
with Trust |
Position
with Thrivent Asset Mgt. |
Michael
W. Kremenak |
Trustee
and President |
Elected
Manager |
David
S. Royal |
Trustee
and Chief Investment
Officer |
Elected
Manager and President |
Sarah
L. Bergstrom |
Treasurer
and Principal Accounting
Officer |
Assistant
Treasurer |
Edward
S. Dryden |
Chief
Compliance Officer |
Chief
Compliance Officer |
John
D. Jackson |
Secretary
and Chief Legal Officer |
Assistant
Secretary |
Affiliated
Person |
Position
with Trust |
Position
with Thrivent Asset Mgt. |
Kathleen
M. Koelling |
Privacy
Officer |
Privacy
Officer |
Sharon
K. Minta |
Anti-Money
Laundering Officer |
Anti-Money
Laundering Officer |
Troy
A. Beaver |
Vice
President |
Vice
President |
Monica
L. Kleve |
Vice
President |
Vice
President and Chief Operating
Officer |
Thrivent
Aggressive Allocation Fund |
|
First
$500 million: |
0.750% |
Next
$1.5 billion: |
0.725% |
Next
$3 billion: |
0.700% |
Next
$5 billion: |
0.675% |
Over
$10 billion: |
0.650% |
Thrivent
Balanced Income Plus Fund |
|
First
$500 million: |
0.550% |
Next
$500 million: |
0.500% |
Next
$1.5 billion: |
0.475% |
Next
$2.5 billion: |
0.450% |
Over
$5 billion: |
0.425% |
Thrivent
Diversified Income Plus Fund |
|
First
$500 million: |
0.550% |
Next
$500 million: |
0.500% |
Next
$1.5 billion: |
0.475% |
Next
$2.5 billion: |
0.450% |
Over
$5 billion: |
0.425% |
Thrivent
Global Stock Fund |
|
First
$500 million: |
0.650% |
Next
$500 million: |
0.575% |
Next
$1 billion: |
0.500% |
Next
$500 million: |
0.475% |
Next
$2.5 billion: |
0.450% |
Over
$5 billion: |
0.425% |
Thrivent
Government Bond Fund |
|
First
$500 million: |
0.400% |
Over
$500 million: |
0.350% |
Thrivent
High Income Municipal Bond Fund |
|
First
$500 million: |
0.500% |
Over
$500 million: |
0.450% |
Thrivent
High Yield Fund |
|
First
$500 million: |
0.400% |
Next
$500 million: |
0.350% |
Over
$1 billion: |
0.300% |
Thrivent
Income Fund |
|
First
$500 million: |
0.350% |
Next
$500 million: |
0.325% |
Over
$1 billion: |
0.300% |
Thrivent
International Allocation Fund |
|
First
$250 million: |
0.700% |
Next
$750 million: |
0.650% |
Next
$500 million: |
0.625% |
Over
$1.5 billion: |
0.600% |
Thrivent
Large Cap Growth Fund |
|
First
$1 billion: |
0.675% |
Next
$1 billion: |
0.625% |
Over
$2 billion: |
0.600% |
Thrivent
Large Cap Value Fund |
|
All
assets: |
0.450% |
Thrivent
Limited Maturity Bond Fund |
|
First
$500 million: |
0.300% |
Next
$500 million: |
0.275% |
Over
$1 billion: |
0.250% |
Thrivent
Low Volatility Equity Fund |
|
First
$100 million: |
0.600% |
Over
$100 million: |
0.500% |
Thrivent
Mid Cap Growth Fund |
|
First
$200 million: |
0.750% |
Over
$200 million: |
0.700% |
Thrivent
Mid Cap Stock Fund |
|
First
$200 million: |
0.700% |
Next
$800 million: |
0.650% |
Next
$1.5 billion: |
0.600% |
Next
$2.5 billion: |
0.550% |
Over
$5 billion: |
0.525% |
Thrivent
Mid Cap Value Fund |
|
First
$200 million: |
0.750% |
Over
$200 million: |
0.700% |
Thrivent
Moderate Allocation Fund |
|
First
$500 million: |
0.650% |
Next
$1.5 billion: |
0.625% |
Next
$3 billion: |
0.600% |
Next
$5 billion: |
0.575% |
Over
$10 billion: |
0.550% |
Thrivent
Moderately Aggressive Allocation Fund |
|
First
$500 million: |
0.700% |
Next
$1.5 billion: |
0.675% |
Next
$3 billion: |
0.650% |
Next
$5 billion: |
0.625% |
Over
$10 billion: |
0.600% |
Thrivent
Moderately Conservative Allocation Fund |
|
First
$500 million: |
0.600% |
Next
$1.5 billion: |
0.575% |
Next
$3 billion: |
0.550% |
Next
$5 billion: |
0.525% |
Over
$10 billion: |
0.500% |
Thrivent
Money Market Fund |
|
All
assets: |
0.250% |
Thrivent
Multidimensional Income Fund |
|
First
$100 million: |
0.550% |
Over
$100 million: |
0.500% |
Thrivent
Municipal Bond Fund |
|
First
$500 million: |
0.450% |
Next
$500 million: |
0.400% |
Next
$1.5 billion: |
0.350% |
Next
$2.5 billion: |
0.325% |
Over
$5 billion: |
0.300% |
Thrivent
Opportunity Income Plus Fund |
|
First
$500 million: |
0.450% |
Next
$500 million: |
0.400% |
Next
$1.5 billion: |
0.375% |
Next
$2.5 billion: |
0.350% |
Over
$5 billion: |
0.325% |
Thrivent
Small Cap Growth Fund |
|
First
$200 million: |
0.800% |
Over
$200 million: |
0.750% |
Thrivent
Small Cap Stock Fund |
|
First
$200 million: |
0.700% |
Next
$800 million: |
0.650% |
Next
$1.5 billion: |
0.600% |
Next
$2.5 billion: |
0.550% |
Over
$5 billion: |
0.525% |
Fund |
Class
A |
Class
S |
Expiration
Date |
Thrivent
Money Market Fund |
0.05% |
- |
2/28/2024 |
Fund |
Class
A |
Class
S |
Expiration
Date |
Thrivent
Balanced Income Plus Fund |
0.99% |
— |
2/28/2024 |
Thrivent
Government Bond Fund |
0.75% |
0.52% |
2/28/2024 |
Thrivent
High Income Municipal Bond Fund |
— |
0.60% |
2/28/2024 |
Thrivent
International Allocation Fund |
1.17% |
— |
2/28/2024 |
Thrivent
Low Volatility Equity Fund |
— |
0.95% |
2/28/2024 |
Thrivent
Mid Cap Growth Fund |
— |
0.90% |
2/28/2024 |
Thrivent
Mid Cap Value Fund |
— |
0.90% |
2/28/2024 |
Thrivent
Multidimensional Income Fund |
— |
0.75% |
2/28/2024 |
Thrivent
Municipal Bond Fund |
— |
0.51% |
2/28/2024 |
Thrivent
Small Cap Growth Fund |
— |
0.95% |
2/28/2024 |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Aggressive Allocation Fund |
$14,555,281 |
$14,006,085 |
$10,553,725 |
Thrivent
Balanced Income Plus Fund |
$2,383,194 |
$2,248,236 |
$1,979,254 |
Thrivent
Diversified Income Plus Fund (1) |
$6,352,973 |
$6,474,260 |
$5,768,934 |
Thrivent
Global Stock Fund |
$10,727,605 |
$11,462,897 |
$9,660,950 |
Thrivent
Government Bond Fund |
$370,915 |
$414,232 |
$270,205 |
Thrivent
High Income Municipal Bond Fund |
$172,527 |
$121,532 |
$84,929 |
Thrivent
High Yield Fund |
$2,800,620 |
$3,128,700 |
$3,000,365 |
Thrivent
Income Fund |
$3,363,206 |
$3,809,986 |
$3,278,093 |
Thrivent
International Allocation Fund |
$5,769,698 |
$6,197,463 |
$5,509,922 |
Thrivent
Large Cap Growth Fund |
$12,828,911 |
$12,963,076 |
$8,832,240 |
Thrivent
Large Cap Value Fund |
$8,270,101 |
$6,853,173 |
$4,893,138 |
Thrivent
Limited Maturity Bond Fund |
$4,172,157 |
$4,406,790 |
$3,214,174 |
Thrivent
Low Volatility Equity Fund |
$179,398 |
$175,420 |
$163,373 |
Thrivent
Mid Cap Growth Fund (2) |
$135,747 |
$103,615 |
$28,140 |
Thrivent
Mid Cap Stock Fund |
$21,297,048 |
$19,311,149 |
$13,666,339 |
Thrivent
Mid Cap Value Fund (2) |
$123,220 |
$65,136 |
$24,095 |
Thrivent
Moderate Allocation Fund |
$21,126,580 |
$20,868,367 |
$17,110,346 |
Thrivent
Moderately Aggressive Allocation Fund |
$25,143,262 |
$25,137,764 |
$20,686,388 |
Thrivent
Moderately Conservative Allocation Fund |
$7,182,432 |
$7,163,940 |
$5,930,328 |
Thrivent
Money Market Fund |
$1,969,414 |
$2,392,438 |
$2,556,153 |
Thrivent
Multidimensional Income Fund (1) |
$364,783 |
$277,405 |
$148,275 |
Thrivent
Municipal Bond Fund |
$5,913,259 |
$6,382,649 |
$6,128,425 |
Thrivent
Opportunity Income Plus Fund |
$3,146,598 |
$3,547,003 |
$3,186,960 |
Thrivent
Small Cap Growth Fund |
$1,200,108 |
$856,266 |
$98,976 |
Thrivent
Small Cap Stock Fund |
$9,804,258 |
$7,223,828 |
$4,230,375 |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Aggressive Allocation Fund |
$3,747,173 |
$3,857,284 |
$2,880,396 |
Thrivent
Balanced Income Plus Fund |
$— |
$— |
$— |
Thrivent
Diversified Income Plus Fund (1) |
$— |
$— |
$— |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Global Stock Fund |
$— |
$— |
$— |
Thrivent
Government Bond Fund |
$90,877 |
$9,058 |
$9,749 |
Thrivent
High Income Municipal Bond Fund |
$206,633 |
$187,814 |
$171,832 |
Thrivent
High Yield Fund |
$— |
$— |
$— |
Thrivent
Income Fund |
$— |
$— |
$— |
Thrivent
International Allocation Fund |
$165,632 |
$189,999 |
$226,588 |
Thrivent
Large Cap Growth Fund |
$— |
$— |
$— |
Thrivent
Large Cap Value Fund |
$— |
$— |
$— |
Thrivent
Limited Maturity Bond Fund |
$— |
$— |
$— |
Thrivent
Low Volatility Equity Fund |
$137,625 |
$140,159 |
$126,204 |
Thrivent
Mid Cap Growth Fund (2) |
$214,061 |
$194,565 |
$97,708 |
Thrivent
Mid Cap Stock Fund |
$— |
$— |
$— |
Thrivent
Mid Cap Value Fund (2) |
$187,719 |
$156,853 |
$89,802 |
Thrivent
Moderate Allocation Fund |
$6,411,870 |
$6,553,626 |
$5,025,345 |
Thrivent
Moderately Aggressive Allocation Fund |
$8,879,689 |
$9,080,661 |
$6,864,379 |
Thrivent
Moderately Conservative Allocation Fund |
$1,747,014 |
$1,781,465 |
$1,431,896 |
Thrivent
Money Market Fund |
$278,889 |
$3,025,527 |
$1,467,906 |
Thrivent
Multidimensional Income Fund (1) |
$180,853 |
$123,550 |
$138,016 |
Thrivent
Municipal Bond Fund |
$— |
$— |
$— |
Thrivent
Opportunity Income Plus Fund |
$— |
$— |
$— |
Thrivent
Small Cap Growth Fund |
$317,183 |
$274,737 |
$178,812 |
Thrivent
Small Cap Stock Fund |
$— |
$— |
$— |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Aggressive Allocation Fund |
$1,047,662 |
$1,204,206 |
$1,190,680 |
Thrivent
Balanced Income Plus Fund |
$166,852 |
$228,967 |
$156,248 |
Thrivent
Diversified Income Plus Fund (1) |
$351,775 |
$645,033 |
$501,512 |
Thrivent
Global Stock Fund |
$395,267 |
$556,728 |
$513,594 |
Thrivent
High Yield Fund |
$137,075 |
$230,511 |
$263,737 |
Thrivent
Income Fund |
$89,384 |
$279,536 |
$229,721 |
Thrivent
International Allocation Fund |
$33,097 |
$50,402 |
$54,344 |
Thrivent
Large Cap Growth Fund |
$251,561 |
$314,869 |
$308,740 |
Thrivent
Large Cap Value Fund |
$150,622 |
$155,303 |
$100,178 |
Thrivent
Mid Cap Stock Fund |
$467,625 |
$602,438 |
$537,949 |
Thrivent
Moderate Allocation Fund |
$1,290,992 |
$1,925,330 |
$1,608,431 |
Thrivent
Moderately Aggressive Allocation Fund |
$1,946,036 |
$2,566,324 |
$2,413,338 |
Thrivent
Moderately Conservative Allocation Fund |
$427,616 |
$673,314 |
$575,871 |
Thrivent
Municipal Bond Fund |
$408,004 |
$819,454 |
$843,249 |
Thrivent
Opportunity Income Plus Fund |
$109,878 |
$189,913 |
$209,498 |
Thrivent
Small Cap Stock Fund |
$213,614 |
$258,997 |
$203,501 |
Affiliated
Person |
Position
with Trust |
Position
with Thrivent Distributors |
Michael
W. Kremenak |
Trustee
and President |
Elected
Manager |
David
S. Royal |
Trustee
and Chief Investment
Officer |
Elected
Manager |
Edward
S. Dryden |
Chief
Compliance Officer |
Chief
Compliance Officer |
John
D. Jackson |
Secretary
and Chief Legal Officer |
Chief
Legal Officer and Secretary |
Troy
A. Beaver |
Vice
President |
Chief
Executive Officer |
Andrew
R. Kellogg |
Vice
President |
Vice
President |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Aggressive Allocation Fund |
$408,664 |
$395,635 |
$314,536 |
Thrivent
Balanced Income Plus Fund |
143,662 |
139,491 |
131,177 |
Thrivent
Diversified Income Plus Fund (1) |
269,001 |
273,125 |
249,221 |
Thrivent
Global Stock Fund |
396,964 |
422,295 |
360,222 |
Thrivent
Government Bond Fund |
85,764 |
87,605 |
81,484 |
Thrivent
High Income Municipal Bond Fund |
75,866 |
74,132 |
72,888 |
Thrivent
High Yield Fund |
193,887 |
209,822 |
203,589 |
Thrivent
Income Fund |
239,926 |
264,649 |
235,124 |
Thrivent
International Allocation Fund |
217,633 |
228,822 |
210,836 |
Thrivent
Large Cap Growth Fund |
403,584 |
399,227 |
291,199 |
Thrivent
Large Cap Value Fund |
382,426 |
328,898 |
254,852 |
Thrivent
Limited Maturity Bond Fund |
328,207 |
344,162 |
263,064 |
Thrivent
Low Volatility Equity Fund |
75,083 |
74,970 |
74,629 |
Thrivent
Mid Cap Growth Fund (2) |
73,077 |
72,349 |
47,304 |
Thrivent
Mid Cap Stock Fund |
671,091 |
609,772 |
440,213 |
Thrivent
Mid Cap Value Fund (2) |
72,793 |
71,476 |
47,213 |
Thrivent
Moderate Allocation Fund |
650,878 |
643,562 |
537,085 |
Thrivent
Moderately Aggressive Allocation Fund |
711,247 |
711,103 |
594,682 |
Thrivent
Moderately Conservative Allocation Fund |
278,655 |
278,108 |
241,636 |
Thrivent
Money Market Fund |
196,794 |
186,204 |
194,156 |
Thrivent
Multidimensional Income Fund (1) |
81,275 |
78,574 |
74,583 |
Thrivent
Municipal Bond Fund |
320,787 |
343,586 |
331,238 |
Thrivent
Opportunity Income Plus Fund |
193,105 |
210,123 |
194,821 |
Thrivent
Small Cap Growth Fund |
95,502 |
88,196 |
72,103 |
Thrivent
Small Cap Stock Fund |
330,787 |
258,390 |
178,025 |
Gross
Income from Securities
Lending
Activities |
Fees
Paid to Securities Lending Agent
from a
Revenue
Split |
Rebates (Paid
to
Borrower) |
Other
Fees not
Included in
the
Revenue
Split |
Aggregate
Fees/ Compensation for
Securities Lending
Activities |
Net
Income from
Securities Lending
Activities |
Thrivent
Aggressive Allocation Fund | |||||
$123,106 |
$5,028 |
$72,945 |
$- |
$77,974 |
$45,132 |
Thrivent
Balanced Income Plus Fund | |||||
$103,222 |
$7,835 |
$25,073 |
$- |
$32,908 |
$70,314 |
Thrivent
Diversified Income Plus Fund | |||||
$667,862 |
$43,864 |
$229,115 |
$- |
$272,978 |
$394,884 |
Thrivent
Global Stock Fund | |||||
$180,634 |
$13,606 |
$41,676 |
$- |
$55,282 |
$125,352 |
Thrivent
High Yield Fund | |||||
$633,713 |
$38,007 |
$255,263 |
$- |
$293,270 |
$340,443 |
Thrivent
Income Fund | |||||
$86,028 |
$3,950 |
$46,700 |
$- |
$50,650 |
$35,378 |
Thrivent
International Allocation Fund | |||||
$144,102 |
$12,496 |
$15,438 |
$- |
$27,934 |
$116,168 |
Thrivent
Large Cap Growth Fund | |||||
$20,840 |
$1,917 |
$1,655 |
$- |
$3,572 |
$17,268 |
Gross
Income from Securities
Lending
Activities |
Fees
Paid to Securities Lending Agent
from a
Revenue
Split |
Rebates (Paid
to
Borrower) |
Other
Fees not
Included in
the
Revenue
Split |
Aggregate
Fees/ Compensation for
Securities Lending
Activities |
Net
Income from
Securities Lending
Activities |
Thrivent
Large Cap Value Fund | |||||
$34,459 |
$2,974 |
$4,739 |
$- |
$7,713 |
$26,746 |
Thrivent
Limited Maturity Bond Fund | |||||
$59,050 |
$2,677 |
$32,377 |
$- |
$35,055 |
$23,995 |
Thrivent
Low Volatility Equity Fund | |||||
$885 |
$84 |
$45 |
$- |
$129 |
$756 |
Thrivent
Mid Cap Growth Fund | |||||
$1,609 |
$101 |
$595 |
$- |
$696 |
$913 |
Thrivent
Mid Cap Stock Fund | |||||
$32,195 |
$2,619 |
$6,173 |
$- |
$8,792 |
$23,403 |
Thrivent
Mid Cap Value Fund | |||||
$412 |
$41 |
$0 |
$- |
$41 |
$371 |
Thrivent
Moderate Allocation Fund | |||||
$247,543 |
$12,239 |
$125,794 |
$- |
$138,032 |
$109,511 |
Thrivent
Moderately Aggressive Allocation Fund | |||||
$229,843 |
$9,695 |
$133,217 |
$- |
$142,911 |
$86,932 |
Thrivent
Moderately Conservative Allocation Fund | |||||
$122,873 |
$6,687 |
$56,323 |
$- |
$63,010 |
$59,863 |
Thrivent
Multidimensional Income Fund | |||||
$50,043 |
$4,091 |
$9,055 |
$- |
$13,146 |
$36,897 |
Thrivent
Opportunity Income Plus Fund | |||||
$222,466 |
$16,036 |
$62,624 |
$- |
$78,661 |
$143,805 |
Thrivent
Small Cap Growth Fund | |||||
$23,275 |
$1,440 |
$8,927 |
$- |
$10,366 |
$12,909 |
Thrivent
Small Cap Stock Fund | |||||
$57,125 |
$2,528 |
$31,851 |
$- |
$34,379 |
$22,746 |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Aggressive Allocation Fund |
$545,263 |
$668,414 |
$610,464 |
Thrivent
Balanced Income Plus Fund |
$66,736 |
$92,544 |
$155,303 |
Thrivent
Diversified Income Plus Fund (1) |
$116,472 |
$216,548 |
$256,738 |
Thrivent
Global Stock Fund |
$1,311,781 |
$1,587,918 |
$1,389,876 |
Thrivent
Government Bond Fund |
$5,070 |
$6,165 |
$4,427 |
Thrivent
High Income Municipal Bond Fund |
$587 |
$124 |
$151 |
Thrivent
High Yield Fund |
$44,978 |
$49,921 |
$3,100 |
Thrivent
Income Fund |
$20,729 |
$9,197 |
$34,906 |
Thrivent
International Allocation Fund |
$1,137,363 |
$1,663,627 |
$1,187,523 |
Thrivent
Large Cap Growth Fund |
$287,778 |
$239,346 |
$233,347 |
Thrivent
Large Cap Value Fund |
$491,039 |
$346,839 |
$424,103 |
Thrivent
Limited Maturity Bond Fund |
$66,185 |
$70,207 |
$46,511 |
Thrivent
Low Volatility Equity Fund |
$22,125 |
$23,146 |
$26,249 |
Thrivent
Mid Cap Growth Fund |
$5,656 |
$5,943 |
$2,584 |
Thrivent
Mid Cap Stock Fund |
$865,636 |
$1,027,344 |
$1,073,782 |
Thrivent
Mid Cap Value Fund |
$8,433 |
$4,865 |
$4,545 |
Thrivent
Moderate Allocation Fund |
$691,622 |
$777,110 |
$662,031 |
Thrivent
Moderately Aggressive Allocation Fund |
$843,078 |
$999,441 |
$963,832 |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Moderately Conservative Allocation Fund |
$157,981 |
$198,307 |
$152,076 |
Thrivent
Money Market Fund |
$— |
$— |
$— |
Thrivent
Multidimensional Income Fund (1) |
$18,953 |
$23,918 |
$17,640 |
Thrivent
Municipal Bond Fund |
$— |
$— |
$— |
Thrivent
Opportunity Income Plus Fund |
$73,712 |
$99,089 |
$72,550 |
Thrivent
Small Cap Growth Fund |
$88,325 |
$94,231 |
$9,431 |
Thrivent
Small Cap Stock Fund |
$916,622 |
$747,402 |
$756,894 |
Fund |
Commissions |
Aggregate
Transactions |
Thrivent
Aggressive Allocation Fund |
$452,489 |
$909,254,997 |
Thrivent
Balanced Income Plus Fund |
$57,021 |
$163,107,114 |
Thrivent
Diversified Income Plus Fund (1) |
$93,291.22 |
$228,220,340.11 |
Thrivent
Global Stock Fund |
$1,235,920 |
$1,980,020,300 |
Thrivent
Government Bond Fund |
$1,632 |
$1,632 |
Thrivent
High Income Municipal Bond Fund |
$316 |
$596,372 |
Thrivent
High Yield Fund |
$40,953 |
$72,283,879 |
Thrivent
Income Fund |
$8,985 |
$9,128,407 |
Thrivent
International Allocation Fund |
$1,070,827 |
$1,190,306,782 |
Thrivent
Large Cap Growth Fund |
$286,901 |
$2,047,826,298 |
Thrivent
Large Cap Value Fund |
$478,178 |
$883,987,748 |
Thrivent
Limited Maturity Bond Fund |
$23,564 |
$24,085 |
Thrivent
Low Volatility Equity Fund |
$21,431 |
$42,905,007 |
Thrivent
Mid Cap Growth Fund |
$5,655 |
$18,233,658 |
Thrivent
Mid Cap Stock Fund |
$861,960 |
$2,029,729,964 |
Thrivent
Mid Cap Value Fund |
$8,433 |
$17,772,651 |
Thrivent
Moderate Allocation Fund |
$579,999 |
$1,173,022,794 |
Thrivent
Moderately Aggressive Allocation Fund |
$703,800 |
$1,354,115,153 |
Thrivent
Moderately Conservative Allocation Fund |
$124,563 |
$254,063,954 |
Thrivent
Money Market Fund |
$— |
$— |
Thrivent
Multidimensional Income Fund (1) |
$18,572.43 |
$18,627,232.86 |
Thrivent
Municipal Bond Fund |
$— |
$— |
Thrivent
Opportunity Income Plus Fund |
$55,509 |
$102,275,586 |
Thrivent
Small Cap Growth Fund |
$85,785 |
$157,911,823 |
Thrivent
Small Cap Stock Fund |
$913,798 |
$1,460,561,942 |
Fund |
10/31/2022 |
10/31/2021 |
10/31/2020 |
Thrivent
Aggressive Allocation Fund |
42% |
50% |
48% |
Thrivent
Balanced Income Plus Fund |
211% |
157% |
85% |
Thrivent
Diversified Income Plus Fund (1,2) |
278% |
268% |
156% |
Thrivent
Global Stock Fund |
58% |
60% |
59% |
Thrivent
Government Bond Fund |
372% |
427% |
322% |
Thrivent
High Income Municipal Bond Fund |
49% |
47% |
94% |
Thrivent
High Yield Fund |
37% |
64% |
62% |
Thrivent
Income Fund |
39% |
54% |
105% |
Thrivent
International Allocation Fund |
90% |
124% |
105% |
Thrivent
Large Cap Growth Fund |
51% |
40% |
44% |
Thrivent
Large Cap Value Fund |
21% |
23% |
34% |
Thrivent
Limited Maturity Bond Fund
(3) |
50% |
169% |
153% |
Thrivent
Low Volatility Equity Fund |
76% |
75% |
72% |
Thrivent
Mid Cap Growth Fund (4) |
33% |
61% |
57% |
Thrivent
Mid Cap Stock Fund |
27% |
48% |
40% |
Thrivent
Mid Cap Value Fund (4) |
31% |
36% |
58% |
Thrivent
Moderate Allocation Fund |
96% |
120% |
117% |
Thrivent
Moderately Aggressive Allocation Fund |
62% |
76% |
81% |
Thrivent
Moderately Conservative Allocation Fund |
140% |
159% |
146% |
Thrivent
Multidimensional Income Fund (1) |
59% |
44% |
61% |
Thrivent
Municipal Bond Fund |
42% |
16% |
29% |
Thrivent
Opportunity Income Plus Fund |
175% |
228% |
186% |
Thrivent
Small Cap Growth Fund |
53% |
42% |
49% |
Thrivent
Small Cap Stock Fund |
42% |
46% |
67% |
Fund |
Regular
Broker or Dealer (or Parent) |
Aggregate
Holdings |
Thrivent
Aggressive Allocation Fund |
J.P.
Morgan |
$4,367,658 |
|
Banc
Of America Securities |
$3,632,363 |
|
Wells
Fargo |
$3,326,733 |
|
Morgan
Stanley & Co. |
$2,784,659 |
|
Citigroup
Global Markets, Inc. |
$2,158,584 |
|
Raymond
James & Associates |
$996,511 |
Thrivent
Balanced Income Plus Fund |
Banc
Of America Securities |
$3,545,417 |
|
J.P.
Morgan |
$2,745,130 |
|
Citigroup
Global Markets, Inc. |
$1,849,643 |
|
Wells
Fargo |
$1,783,802 |
|
Morgan
Stanley & Co. |
$1,437,225 |
|
Goldman
Sachs |
$909,793 |
|
Barclays
Capital, Inc. |
$312,312 |
|
Credit
Suisse First Boston Corporation |
$247,186 |
|
Raymond
James & Associates |
$207,099 |
|
S.C.
Bernstein |
$77,517 |
|
Nomura
Securities |
$45,901 |
Thrivent
Diversified Income Plus Fund |
J.P.
Morgan |
$8,671,903 |
|
Banc
Of America Securities |
$8,535,782 |
|
Citigroup
Global Markets, Inc. |
$5,413,203 |
|
Wells
Fargo |
$4,879,853 |
|
Morgan
Stanley & Co. |
$4,036,013 |
|
Goldman
Sachs |
$3,595,962 |
|
Credit
Suisse First Boston Corporation |
$2,679,900 |
|
Barclays
Capital, Inc. |
$2,521,517 |
|
S.C.
Bernstein |
$330,537 |
|
Jane
Street Execution Services, LLC |
$299,644 |
|
Jefferies
& Company |
$247,166 |
|
Nomura
Securities |
$165,136 |
Thrivent
Global Stock Fund |
J.P.
Morgan |
$10,364,456 |
|
Banc
Of America Securities |
$7,811,129 |
|
Wells
Fargo |
$7,123,391 |
|
Morgan
Stanley & Co. |
$5,956,668 |
|
Barclays
Capital, Inc. |
$689,496 |
|
Deutsche
Bank, Inc. |
$122,507 |
Thrivent
Government Bond Fund |
HSBC
Securities |
$244,658 |
Thrivent
High Income Municipal Bond Fund |
Huntington |
$162,263 |
Fund |
Regular
Broker or Dealer (or Parent) |
Aggregate
Holdings |
Thrivent
High Yield Fund |
Deutsche
Bank, Inc. |
$496,063 |
Thrivent
Income Fund |
Banc
Of America Securities |
$21,964,138 |
|
J.P.
Morgan |
$16,908,060 |
|
Morgan
Stanley & Co. |
$13,587,290 |
|
Goldman
Sachs |
$11,561,004 |
|
Wells
Fargo |
$11,201,461 |
|
Citigroup
Global Markets, Inc. |
$11,105,821 |
|
Credit
Suisse First Boston Corporation |
$8,876,200 |
|
HSBC
Securities |
$6,341,318 |
|
Barclays
Capital, Inc. |
$6,272,333 |
|
Deutsche
Bank, Inc. |
$6,014,636 |
Thrivent
International Allocation Fund |
Barclays
Capital, Inc. |
$822,598 |
|
Deutsche
Bank, Inc. |
$355,924 |
Thrivent
Large Cap Value Fund |
Banc
Of America Securities |
$40,578,806 |
|
J.P.
Morgan |
$37,054,540 |
|
Statestreet
Bank |
$17,918,582 |
|
Raymond
James & Associates |
$11,161,277 |
Thrivent
Limited Maturity Bond Fund |
Banc
Of America Securities |
$26,469,943 |
|
Goldman
Sachs |
$21,846,980 |
|
J.P.
Morgan |
$21,336,037 |
|
Morgan
Stanley & Co. |
$19,144,854 |
|
Citigroup
Global Markets, Inc. |
$16,569,621 |
|
Credit
Suisse First Boston Corporation |
$7,919,629 |
|
Barclays
Capital, Inc. |
$7,777,582 |
|
Thrivent
Investment Management |
$4,500,363 |
|
Bank
Of New York Mellon |
$3,715,782 |
|
Nomura
Securities |
$3,254,686 |
|
Mizuho
Securities |
$2,064,481 |
Thrivent
Mid Cap Value Fund |
Raymond
James & Associates |
$182,644 |
Thrivent
Moderate Allocation Fund |
J.P.
Morgan |
$9,670,388 |
|
Banc
Of America Securities |
$7,862,514 |
|
Citigroup
Global Markets, Inc. |
$6,756,944 |
|
Morgan
Stanley & Co. |
$6,109,828 |
|
Wells
Fargo |
$5,576,908 |
|
Goldman
Sachs |
$3,836,849 |
|
Credit
Suisse First Boston Corporation |
$3,176,313 |
|
Barclays
Capital, Inc. |
$2,326,853 |
|
Raymond
James & Associates |
$976,073 |
Thrivent
Moderately Aggressive Allocation Fund |
Citigroup
Global Markets, Inc. |
$5,928,811 |
|
J.P.
Morgan |
$5,826,098 |
|
Banc
Of America Securities |
$5,570,726 |
|
Morgan
Stanley & Co. |
$4,461,510 |
Fund |
Regular
Broker or Dealer (or Parent) |
Aggregate
Holdings |
|
Wells
Fargo |
$3,915,372 |
|
Goldman
Sachs |
$2,536,628 |
|
Credit
Suisse First Boston Corporation |
$1,944,540 |
|
Barclays
Capital, Inc. |
$1,365,588 |
|
Raymond
James & Associates |
$792,129 |
Thrivent
Moderately Conservative Allocation Fund |
J.P.
Morgan |
$3,570,845 |
|
Citigroup
Global Markets, Inc. |
$2,812,626 |
|
Banc
Of America Securities |
$2,722,784 |
|
Goldman
Sachs |
$2,325,717 |
|
Morgan
Stanley & Co. |
$2,178,307 |
|
Credit
Suisse First Boston Corporation |
$1,679,633 |
|
Wells
Fargo |
$1,514,935 |
|
Barclays
Capital, Inc. |
$1,423,017 |
|
Raymond
James & Associates |
$91,677 |
Thrivent
Money Market Fund |
RBC
Capital Markets |
$130,000,000 |
|
Goldman
Sachs |
$106,340,000 |
Thrivent
Multidimensional Income Fund |
J.P.
Morgan |
$1,187,091 |
|
Banc
Of America Securities |
$1,106,788 |
|
Wells
Fargo |
$1,048,523 |
|
Citigroup
Global Markets, Inc. |
$903,989 |
|
Goldman
Sachs |
$468,305 |
|
Morgan
Stanley & Co. |
$380,313 |
|
Credit
Suisse First Boston Corporation |
$261,601 |
|
Deutsche
Bank, Inc. |
$248,272 |
|
S.C.
Bernstein |
$241,795 |
|
UBS
Warburg |
$211,875 |
|
Barclays
Capital, Inc. |
$57,188 |
Thrivent
Opportunity Income Plus Fund |
Banc
Of America Securities |
$9,608,710 |
|
J.P.
Morgan |
$6,593,583 |
|
Citigroup
Global Markets, Inc. |
$4,582,131 |
|
Wells
Fargo |
$3,235,112 |
|
Goldman
Sachs |
$3,227,741 |
|
Morgan
Stanley & Co. |
$3,058,831 |
|
Deutsche
Bank, Inc. |
$3,005,586 |
|
Credit
Suisse First Boston Corporation |
$1,796,661 |
|
Barclays
Capital, Inc. |
$1,187,564 |
|
S.C.
Bernstein |
$389,499 |
|
Nomura
Securities |
$172,524 |
Aaa: |
Obligations
rated Aaa are judged to be of the highest quality, subject to the lowest
level of credit risk. |
Aa: |
Obligations
rated Aa are judged to be of high quality and are subject to very low
credit risk. |
A: |
Obligations
rated A are judged to be upper-medium grade and are subject to low credit
risk. |
Baa: |
Obligations
rated Baa are judged to be medium-grade and subject to moderate credit
risk and as such
may
possess certain speculative characteristics. |
Ba: |
Obligations
rated Ba are judged to be speculative and are subject to substantial
credit risk. |
B: |
Obligations
rated B are judged to be speculative and are subject to high credit
risk. |
Caa: |
Obligations
rated Caa are judged to be speculative of poor standing and are subject to
very high credit
risk. |
Ca: |
Obligations
rated Ca are highly speculative and are likely in, or very near, default,
with some prospect of
recovery
of principal and interest. |
C: |
Obligations
rated C are the lowest rated and are typically in default, with little
prospect for recovery of
principal
or interest. |
P-1: |
Ratings
of Prime-1 reflect a superior ability to repay short-term
obligations. |
P-2: |
Ratings
of Prime-2 reflect a strong ability to repay short-term
obligations. |
P-3: |
Ratings
of Prime-3 reflect an acceptable ability to repay short-term
obligations. |
NP: |
Issuers
(or supporting institutions) rated Not Prime do not fall within any of the
Prime rating categories. |
MIG
1: |
This
designation denotes superior credit quality. Excellent protection is
afforded by established cash flows,
highly
reliable liquidity support, or demonstrated broad-based access to the
market for refinancing. |
MIG
2: |
This
designation denotes strong credit quality. Margins of protection are
ample, although not as large as in
the
preceding group. |
MIG
3: |
This
designation denotes acceptable credit quality. Liquidity and cash-flow
protection may be narrow, and
market
access for refinancing is likely to be less
well-established. |
SG: |
This
designation denotes speculative-grade credit quality. Debt instruments in
this category may lack
sufficient
margins of protection. |
VMIG
1: |
This
designation denotes superior credit quality. Excellent protection is
afforded by the superior short-term
credit
strength of the liquidity provider and structural and legal
protections. |
VMIG
2: |
This
designation denotes strong credit quality. Good protection is afforded by
the strong short-term credit
strength
of the liquidity provider and structural and legal
protections. |
VMIG
3: |
This
designation denotes acceptable credit quality. Adequate protection is
afforded by the satisfactory
short-term
credit strength of the liquidity provider and structural and legal
protections. |
SG: |
This
designation denotes speculative-grade credit quality. Demand features
rated in this category may be
supported
by a liquidity provider that does not have a sufficiently strong
short-term rating or may lack the
structural
or legal protections. |
AAA: |
An
obligation rated ‘AAA’ has the highest rating assigned by S&P Global
Ratings. The obligor’s capacity to
meet
its financial commitment on the obligation is extremely
strong. |
AA: |
An
obligation rated ‘AA’ differs from the highest-rated obligations only to a
small degree. The obligor’s
capacity
to meet its financial commitment on the obligation is very
strong. |
A: |
An
obligation rated ‘A’ is somewhat more susceptible to the adverse effects
of changes in circumstances
and
economic conditions than obligations in higher-rated categories. However,
the obligor’s capacity to
meet
its financial commitment on the obligation is still
strong. |
BBB: |
An
obligation rated ‘BBB’ exhibits adequate protection parameters. However,
adverse economic conditions
or
changing circumstances are more likely to lead to a weakened capacity of
the obligor to meet its
financial
commitment on the obligation. |
BB: |
An
obligation rated ‘BB’ is less vulnerable to nonpayment than other
speculative issues. However, it faces
major
ongoing uncertainties or exposure to adverse business, financial, or
economic conditions which
could
lead to the obligor’s inadequate capacity to meet its financial commitment
on the obligation. |
B: |
An
obligation rated ‘B’ is more vulnerable to nonpayment than obligations
rated ‘BB’, but the obligor
currently
has the capacity to meet its financial commitment on the obligation.
Adverse business, financial,
or
economic conditions will likely impair the obligor’s capacity or
willingness to meet its financial
commitment
on the obligation. |
CCC: |
An
obligation rated ‘CCC’ is currently vulnerable to nonpayment, and is
dependent upon favorable
business,
financial, and economic conditions for the obligor to meet its financial
commitment on the
obligation.
In the event of adverse business, financial, or economic conditions, the
obligor is not likely to
have
the capacity to meet its financial commitment on the
obligation. |
CC: |
An
obligation rated ‘CC’ is currently highly vulnerable to nonpayment. The
‘CC’ rating is used when a
default
has not yet occurred, but S&P Global Ratings expects default to be a
virtual certainty, regardless of
the
anticipated time to default. |
C: |
An
obligation rated ‘C’ is currently highly vulnerable to nonpayment, and the
obligation is expected to have
lower
relative seniority or lower ultimate recovery compared to obligations that
are rated higher. |
D: |
An
obligation rated ‘D’ is in default or in breach of an imputed promise. For
non-hybrid capital instruments,
the
‘D’ rating category is used when payments on an obligation are not made on
the date due, unless S&P
Global
Ratings believes that such payments will be made within five business days
in the absence of a
stated
grace period or within the earlier of the stated grace period or the next
30 calendar days. The ‘D’
rating
also will be used upon the filing of a bankruptcy petition or the taking
of similar action and where
default
on an obligation is a virtual certainty, for example due to automatic stay
provisions. A rating on an
obligation
is lowered to ‘D’ if it is subject to a distressed debt
restructuring. |
Plus
(+) or
minus
(-): |
The
ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+)
or minus (-) sign to show
relative
standing within the rating
categories. |
A-1: |
A
short-term obligation rated ‘A-1’ is rated in the highest category by
S&P Global Ratings. The obligor’s
capacity
to meet its financial commitment on the obligation is strong. Within this
category, certain
obligations
are designated with a plus sign (+). This indicates that the obligor’s
capacity to meet its
financial
commitment on these obligations is extremely
strong. |
A-2: |
A
short-term obligation rated ‘A-2’ is somewhat more susceptible to the
adverse effects of changes in
circumstances
and economic conditions than obligations in higher rating categories.
However, the obligor’s
capacity
to meet its financial commitment on the obligation is
satisfactory. |
A-3: |
A
short-term obligation rated ‘A-3’ exhibits adequate protection parameters.
However, adverse economic
conditions
or changing circumstances are more likely to lead to a weakened capacity
of the obligor to meet
its
financial commitment on the obligation. |
B: |
A
short-term obligation rated ‘B’ is regarded as vulnerable and has
significant speculative characteristics.
The
obligor currently has the capacity to meet its financial commitments;
however, it faces major ongoing
uncertainties
which could lead to the obligor’s inadequate capacity to meet its
financial commitments. |
C: |
A
short-term obligation rated ‘C’ is currently vulnerable to nonpayment and
is dependent upon favorable
business,
financial, and economic conditions for the obligor to meet its financial
commitment on the
obligation. |
D: |
A
short-term obligation rated ‘D’ is in default or in breach of an imputed
promise. For non-hybrid capital
instruments,
the ‘D’ rating category is used when payments on an obligation are not
made on the date due,
unless
S&P Global Ratings believes that such payments will be made within any
stated grace period.
However,
any stated grace period longer than five business days will be treated as
five business days. The
‘D’
rating also will be used upon the filing of a bankruptcy petition or the
taking of a similar action and
where
default on an obligation is a virtual certainty, for example due to
automatic stay provisions. A rating
on
an obligation is lowered to ‘D’ if it is subject to a distressed debt
restructuring. |
Investment
Grade | |
AAA: |
Highest
credit quality. ‘AAA’ ratings denote the lowest expectation of credit
risk. They are assigned only in
case
of exceptionally strong capacity for payment of financial commitments.
This capacity is highly unlikely
to
be adversely affected by foreseeable
events. |
AA: |
Very
high credit quality. “AA” ratings denote expectations of very low credit
risk. They indicate very strong
capacity
for timely payment of financial commitments. This capacity is not
significantly vulnerable to
foreseeable
events. |
A: |
High
credit quality. “A” ratings denote low expectation of credit risk. The
capacity for timely payment of
financial
commitments is considered strong. This capacity may, nevertheless, be more
vulnerable to
adverse
business or economic conditions than is the case for higher
ratings. |
BBB: |
Good
credit quality. “BBB” ratings indicate that expectations of credit risk
are currently low. The capacity
for
payment of financial commitments is considered adequate, but adverse
business or economic
conditions
are more likely to impair this
capacity. |
Speculative
Grade | |
BB: |
Speculative.
‘BB’ ratings indicate an elevated vulnerability to credit risk,
particularly in the event of adverse
changes
in business or economic conditions over time; however, business or
financial alternatives may be
available
to allow financial commitments to be met. |
B: |
Highly
speculative. ‘B’ ratings indicate that material credit risk is
present. |
CCC: |
Substantial
credit risk. ‘CCC’ ratings indicate that substantial credit risk is
present. |
CC: |
Very
high levels of credit risk. ‘CC’ ratings indicate very high levels of
credit risk. |
C: |
Exceptionally
high levels of credit risk. ‘C’ indicates exceptionally high levels of
credit risk. |
F1: |
Highest
short-term credit quality. Indicates the strongest intrinsic capacity for
timely payment of financial
commitments;
may have an added “+” to denote any exceptionally strong credit
feature. |
F2: |
Good
short-term credit quality. Good intrinsic capacity for timely payment of
financial commitments. |
F3: |
Fair
short-term credit quality. The intrinsic capacity for timely payment of
financial commitments is
adequate. |
B: |
Speculative
short-term credit quality. Minimal capacity for timely payment of
financial commitments, plus
heightened
vulnerability to near term adverse changes in financial and economic
conditions. |
C: |
High
short-term default risk. Default is a real
possibility. |
RD: |
Restricted
default. Indicates an entity that has defaulted on one or more of its
financial commitments,
although
it continues to meet other financial obligations. Typically applicable to
entity ratings only. |
D: |
Default.
Indicates a broad-based default event for an entity, or the default of a
short-term obligation. |
Thrivent Financial for Lutherans and
Thrivent Asset Management, LLC
Proxy Voting Policies and Procedures Summary
Responsibility to Vote Proxies
Overview. Thrivent Financial for Lutherans and Thrivent Asset Management, LLC (collectively, in their capacity as investment advisers, “Thrivent”) have adopted Proxy Voting Policies and Procedures (“Policies and Procedures”) for the purpose of establishing formal policies and procedures for performing and documenting Thrivent’s fiduciary duty with regard to the voting of client proxies, including investment companies which it sponsors and for which it serves as investment adviser (“Thrivent Funds”) and by institutional accounts who have requested that Thrivent be involved in the proxy process.
Fiduciary Considerations. It is the policy of Thrivent that decisions with respect to proxy issues will be made primarily in light of the anticipated impact of the issue on the desirability of investing in the portfolio company from the viewpoint of the particular client. Thrivent seeks to vote proxies solely in the interests of the client, including Thrivent Funds. Thrivent votes proxies, where possible to do so, in a manner consistent with its fiduciary obligations and responsibilities. Logistics involved may make it impossible at times, and at other times disadvantageous, to vote proxies in every instance.
Administration of Policies and Procedures
Thrivent has formed a committee that is responsible for establishing positions with respect to corporate governance and other proxy issues, as well as overseeing the environmental, social and governance (“ESG”) analysis components of Thrivent’s investment processes (“Committee”). Annually, the Committee reviews the Policies and Procedures, including in relation to recommended changes reflected in applicable benchmark policies and voting guidelines of Institutional Shareholder Services Inc. (“ISS”). As discussed below, Thrivent may, with the approval of the Committee, vote proxies other than in accordance with the applicable voting guidelines in the Policies and Procedures.
How Proxies are Reviewed, Processed and Voted
In order to facilitate the proxy voting process, Thrivent has retained ISS, an unaffiliated third-party proxy service provider, to provide proxy voting-related services, including custom vote recommendations, research, vote execution, reporting, auditing and consulting assistance for the handling of proxy voting responsibilities. ISS specializes in providing a variety of fiduciary-level proxy advisory and voting services. ISS analyzes each proxy vote of Thrivent’s clients and prepares a recommendation and/or materials for Thrivent’s consideration which reflect ISS’s application of the Policies and Procedures. In determining how to vote proxies, Thrivent leverages the applicable market specific ISS Benchmark Proxy Voting Guidelines (“Benchmark Guidelines”) and ISS Sustainability Proxy Voting Guidelines (“Sustainability Guidelines,” collectively the “Guidelines”). While these Guidelines differ in some respects, particularly on environmental, social and governance proposals or proposals that implicate environmental, social and governance considerations, they are aligned in many areas, including auditor ratification, executive and director compensation, equity-based compensation plans, mergers & acquisitions, and capital structure-related. In some cases, generally where the ISS recommendations do not differ between the Guidelines, Thrivent will provide standing instructions to ISS to vote proxies based on the recommendation of ISS pursuant to the Guidelines. In cases where (i) the Sustainability Guidelines and Benchmark Guidelines recommend voting in a different manner on environmental, social and governance proposals, or
1
proposals that implicate environmental, social and governance considerations, (ii) items are not addressed by the Guidelines, and (iii) for other specified proposal types, Thrivent uses ISS’s research and recommendations and a determination by investment management or other Thrivent personnel as the circumstances warrant.
Certain of Thrivent’s clients’ accounts are accounts or funds (or a portion thereof) that employ a quantitative strategy that relies on factor-based models or an index-tracking approach rather than primarily on fundamental security research and analyst coverage that an actively managed portfolio using fundamental research would typically employ; often, these accounts hold a high number of positions. Accordingly, in light of the considerable time and effort that would be required to review ISS research and recommendations, absent client direction, for securities held only in accounts or funds that only employ a quantitative strategy (and are not held in other Thrivent client accounts, or in the same account but in the portion managed using fundamental research and analyst coverage), for certain categories of management and shareholder proposals, Thrivent may use a different process than is used for other accounts to review and determine a voting outcome. For these proposals, Thrivent may review Benchmark Guidelines and Sustainability Guidelines and (i) determine, consistent with the best interest of its clients, to provide standing instructions to vote proxies in accordance with the recommendations of ISS where such Guidelines recommend voting in the same manner; or (ii) where such Guidelines do not recommend voting in the same manner, vote as determined by Thrivent personnel other than the affected account’s investment management team.
The Benchmark Guidelines and Sustainability Guidelines can be found at:
https://www.issgovernance.com/policy-gateway/voting-policies/.
Supplement applicable to Thrivent Small-Mid Cap ESG ETF (the “ETF”) only. Thrivent expects to vote proxies on behalf of the ETF in many cases in accordance with its custom guidelines created as described above and discussed below under the heading “Summary of Thrivent’s Voting Policies.” However, Thrivent retains the discretion in all cases to vote in a manner inconsistent with these guidelines and policies if it believes such a vote is in the ETF’s best interest after consideration of any information Thrivent believes relevant, including in light of the ETF’s focus on long-term sustainable business models. This may mean that proxies are voted on behalf of the ETF in a manner that differs from votes for other clients.
Supplement applicable to Thrivent ESG Index Portfolio (“ESG Index Portfolio”) only. Thrivent expects to vote proxies on behalf of ESG Index Portfolio in many cases in accordance with its custom guidelines created as described above and discussed below under the heading “Summary of Thrivent’s Voting Policies,” using similar processes as for other clients employing a quantitative strategy as discussed above. However, Thrivent retains the discretion in all cases to vote in a manner inconsistent with these guidelines and policies if it believes such a vote is in ESG Index Portfolio’s best interest after consideration of any information Thrivent believes relevant, including in light of ESG Index Portfolio’s focus on tracking the investment results of an index composed of companies selected by the index provider based on environmental, social and governance characteristics. This may mean that proxies are voted on behalf of ESG Index Portfolio in a manner that differs from votes for other clients.
Proxy Voting Process Overview
Thrivent utilizes ISS’s voting agent services to notify us of upcoming shareholder meetings for portfolio companies held in client accounts and to transmit votes on behalf of our clients. ISS provides comprehensive summaries of proxy proposals, publications discussing key proxy voting issues, and specific vote recommendations regarding Thrivent’s clients’ portfolio company proxies to assist in the proxy voting process. The final authority and responsibility for proxy voting decisions remains with Thrivent. Decisions with respect to proxy matters are made primarily in light of the anticipated impact of the issue on the desirability of investing in the company from the viewpoint of our respective clients.
Thrivent may on any particular proxy vote determine that it is in the best interests of its clients to diverge from the Policies and Procedures’ applicable voting guidelines, including diverging from ISS’s
2
recommendations with respect to Thrivent’s clients’ accounts that are accounts or funds (or a portion thereof) that employ a quantitative strategy. In such cases, the person requesting to diverge from the Policies and Procedures’ applicable voting guidelines is required to document in writing the rationale for their vote and submit all written documentation to the Committee for review and approval. In determining whether to approve any particular request, the Committee will determine that the request is not influenced by any conflict of interest and is in the best interests of Thrivent’s clients.
Summary of Thrivent’s Voting Policies
Specific voting guidelines have been adopted by the Committee for regularly occurring categories of management and shareholder proposals. The detailed voting guidelines are available to Thrivent’s clients upon request. The following is a summary of significant Thrivent policies, which are generally consistent with the Sustainability Guidelines or Benchmark Guidelines referenced above:
Board Structure and Composition Issues – Thrivent believes boards are expected to have a majority of directors independent of management. The independent directors are expected to organize much of the board’s work, even if the chief executive officer also serves as chairperson of the board. Key committees (audit, compensation, and nominating/corporate governance) of the board are expected to be entirely independent of management. It is expected that boards will engage in critical self-evaluation of themselves and of individual members. Boards should be sufficiently diverse to ensure consideration of a wide range of perspectives. Individual directors, in turn, are expected to devote significant amounts of time to their duties and to limit the number of directorships they accept. As such, Thrivent withholds votes for directors who miss more than one-fourth of the scheduled board meetings. Thrivent votes against management efforts to stagger board member terms because a staggered board may act as a deterrent to takeover proposals. For the same reasons, Thrivent votes for proposals that seek to fix the size of the board.
Board Accountability – Thrivent believes boards should be sufficiently accountable to shareholders, including through transparency of the company’s governance practices and regular board elections, by the provision of sufficient information for shareholders to be able to assess directors and board composition, and through the ability of shareholders to remove directors. Boards should be held responsible for risk oversight or fiduciary responsibility failures. Examples of risk oversight failures include but are not limited to: bribery; large or serial fines or sanctions from regulatory bodies; demonstrably poor risk oversight of environmental and social issues; or significant adverse legal judgements or settlement. Thrivent will generally withhold votes from appropriate directors if the company’s governing documents impose undue restrictions on shareholder’s ability to amend bylaws, non-audit fees paid to the auditor are excessive, the company maintains significant problematic pay practices, or the company is a significant greenhouse gas emitter and is not taking the minimum steps needed to understand, assess, and mitigate risks related to climate change via detailed disclosure of climate-related risks and appropriate greenhouse gas emissions reduction targets.
Executive and Director Compensation – These proposals necessitate a case-by-case evaluation. Generally, Thrivent opposes compensation packages that provide what we view as excessive awards to a few senior executives or that contain excessively dilutive stock option grants based on a number of criteria such as the costs associated with the plan, plan features, and dilution to shareholders.
Ratification of Auditors – Thrivent votes for proposals to ratify auditors, unless an auditor has a financial interest in or association with the company, and is therefore not independent; there is reason to believe that the independent auditor has rendered an opinion that is neither accurate nor indicative of the company’s financial position; non-audit fees paid represent 50 percent or more of the total fees paid to the auditor; or poor accounting practices are identified that rise to a serious level of concern.
Mergers and Acquisitions – Thrivent votes on mergers and acquisitions on a case-by-case basis, taking into account and balancing the following: anticipated financial and operating benefits, including the opinion of the financial advisor, market reaction, offer price (cost vs. premium) and prospects of the combined companies; how the deal was negotiated; potential conflicts of interest between management’s
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interests and shareholders’ interests; and changes in corporate governance and their impact on shareholder rights.
Anti-takeover and Corporate Governance Issues – Thrivent generally opposes anti-takeover measures since they adversely impact shareholder rights. When voting on capital structure issues, Thrivent considers the dilutive impact to shareholders and the effect on shareholder rights.
Social, Environmental and Corporate Responsibility Issues – Thrivent votes on proposals related to social, environmental, and corporate responsibility issues on a case-by-case basis. These issues may include business activity impacts on the environment and climate, human and labor rights, health and safety, diversity, equity and inclusion, as well as general impacts on communities. The overall guiding principle on vote determinations examines primarily whether the proposal is likely to enhance or protect shareholder value in the short or long term (for the ETF and the ESG Index Portfolio, whether the proposal is likely to enhance value for other stakeholders may be an additional consideration). Other factors that are considered include, but are not limited to: whether legislation or government regulation is appropriately dealing with the issue; whether the request is unduly burdensome or overly prescriptive; whether there are any significant controversies, fines, penalties, or litigation associated with the company’s practices; and whether the company already provides reasonable and sufficient information if the proposal requests increased disclosure or greater transparency.
Shareblocking – Shareblocking is the practice in certain foreign countries of “freezing” shares for trading purposes in order to vote proxies relating to those shares. Thrivent generally refrains from voting shares in shareblocking countries unless the matter has compelling economic consequences that outweigh the loss of liquidity in the blocked shares.
Applying Proxy Voting Policies to non-U.S. Companies – Thrivent applies a two-tier approach to determining and applying global proxy voting policies. The first tier establishes baseline policy guidelines for the most fundamental issues, which apply without regard to a company’s domicile. The second tier takes into account various idiosyncrasies of different countries, making allowances for standard market practices, as long as they do not violate the fundamental goals of good corporate governance. The goal is to enhance shareholder value through effective use of the shareholder franchise, recognizing that applying policies developed for U.S. corporate governance may not appropriate for all markets.
Monitoring and Resolving Conflicts of Interest – Thrivent/clients
The Committee is responsible for monitoring and resolving possible material conflicts between the interests of Thrivent and those of its clients with respect to proxy voting. Examples of situations where conflicts of interest can arise are when i) the issuer is a vendor whose products or services are material to Thrivent’s business; ii) the issuer is an entity participating to a material extent in the distribution of proprietary investment products advised, administered or sponsored by Thrivent; iii) an Access Person1 of Thrivent also serves as a director or officer of the issuer; and iv) there is a personal conflict of interest (e.g., familial relationship with company management). Other circumstances or relationships can also give rise to potential conflicts of interest.
All material conflicts of interest will be resolved in the interests of the clients. Application of the Policies and Procedures’ applicable voting guidelines to vote client proxies is generally relied on to address possible conflicts of interest since the voting guidelines are pre-determined by the Committee. Where there is discretion in the voting guidelines, voting as recommended under an ISS policy may be relied on to address potential conflicts of interest.
In cases where Thrivent is considering overriding these Policies and Procedures’ applicable voting guidelines, or in the event there is discretion in determining how to vote (for example, where or the guidelines provide for a case by case internal review) matters presented for vote are not governed by such guidelines, the Committee will follow these or other similar procedures:
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“Access Person” has the meaning provided under the current Thrivent Code of Ethics. |
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Compliance will conduct a review to seek to identify potential material conflicts of interest. If no material conflict of interest is identified, the proxy will be voted as determined by the Committee or the appropriate Thrivent personnel under these policies and procedures. The Compliance review process for identifying potential conflicts of interest will be reviewed by the Committee and may include a review of factors indicative of a potential conflict of interest or a determination that voting in accordance with ISS’s recommendation(s) can reasonably be relied on to address potential conflicts of interest. |
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If a material conflict of interest is identified, the Committee will be apprised of that fact and the Committee will evaluate the proposed vote in order to ensure that the proxy ultimately is voted in what Thrivent believes to be the best interests of clients, and without regard for the conflict of interest. The Committee will document its vote determination, including the nature of the material conflict, the Committee’s analysis of the matters submitted for proxy vote, and the reasons why the Committee determined that the votes were cast in the best interests of clients. |
Certain Thrivent Funds (“top tier fund”) may own shares of other Thrivent Funds (“underlying fund”). If an underlying fund submits a matter to a shareholder vote, the top tier fund will generally vote its shares in the same proportion as the other shareholders of the underlying fund. If there are no other shareholders in the underlying fund, the top tier fund will vote in what Thrivent believes to be in the top tier fund’s best interest.
Securities Lending
Thrivent will generally not vote nor seek to recall in order to vote shares on loan, unless it determines that a vote would have a material effect on an investment in such loaned security.
Oversight, Reporting and Record Retention
Retention of Proxy Service Provider and Oversight of Voting
In overseeing proxy voting generally and determining whether or not to retain the services of ISS, Thrivent performs the following functions, among others, to determine that Thrivent continues to vote proxies in the best interest of its clients: i) periodic sampling of proxy votes; ii) periodic reviews of Thrivent’s Policies and Procedures to determine they are adequate and have been implemented effectively, including whether they continue to be reasonably designed to ensure that proxies are voted in the best interest of Thrivent’s clients; iii) periodic due diligence on ISS designed to monitor ISS’s a) capacity and competency to adequately analyze proxy issues, including the adequacy and quality of its staffing and personnel, as well as b) its methodologies for developing vote recommendations and ensuring that its research is accurate and complete; and iv) periodic reviews of ISS’s procedures regarding their capabilities to identify and address conflicts of interest.
Proxy statements and solicitation materials of issuers (other than those which are available on the SEC’s EDGAR database) are kept by ISS in its capacity as voting agent and are available upon request. Thrivent retains documentation on shares voted differently than the Thrivent Policies and Procedures voting guidelines, and any document which is material to a proxy voting decision such as the Thrivent Policies and Procedures voting guidelines and the Committee meeting materials.
ISS provides Vote Summary Reports for each Thrivent Fund. The report specifies the company, ticker, cusip, meeting dates, proxy proposals, and votes which have been cast for the Thrivent Fund during the period, the position taken with respect to each issue and whether the Thrivent Fund voted with or against company management.
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Policy, Procedures and Guidelines for
Goldman Sachs Asset Management’s
Global Proxy Voting
2022 Edition
March 2022
For further information, please contact [email protected].
Table of Contents |
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GOLDMAN SACHS ASSET MANAGEMENT POLICY AND PROCEDURES ON PROXY VOTING FOR INVESTMENT ADVISORY CLIENTS |
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GOLDMAN SACHS ASSET MANAGEMENT’S PROXY VOTING GUIDELINES SUMMARY |
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5. Strategic Transactions, Capital Structures and other Business Considerations |
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5. Strategic Transactions, Capital Structures and other Business Considerations |
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PART I:
GOLDMAN SACHS ASSET MANAGEMENT1 POLICY AND PROCEDURES ON PROXY VOTING FOR INVESTMENT ADVISORY CLIENTS
A: Our Approach to Proxy Voting
Proxy voting and the analysis of corporate governance issues in general are important elements of the portfolio management services we provide to our advisory clients who have authorized us to address these matters on their behalf. Our guiding principles in performing proxy voting are to make decisions that favor proposals that in our view maximize a company’s shareholder value and are not influenced by conflicts of interest. These principles reflect our belief that sound corporate governance will create a framework within which a company can be managed in the interests of its shareholders. We recognize that Environmental, Social and Governance (ESG) factors can affect investment performance, expose potential investment risks and provide an indication of management excellence and leadership. When evaluating ESG proxy issues, we balance the purpose of a proposal with the overall benefit to shareholders.
To implement these guiding principles for investments in publicly traded equities for which we have voting power on any record date, we follow customized proxy voting guidelines that have been developed by our portfolio management and our Global Stewardship Team (the “Guidelines”). The Guidelines embody the positions and factors we generally consider important in casting proxy votes. They address a wide variety of individual topics, including, among other matters, shareholder voting rights, anti-takeover defenses, board structures, the election of directors, executive and director compensation, reorganizations, mergers, issues of corporate social responsibility and various shareholder proposals. Recognizing the complexity and fact-specific nature of many corporate governance issues, the Guidelines identify factors we consider in determining how the vote should be cast. A summary of the Guidelines is attached as Part II.
The principles and positions reflected in this Policy are designed to guide us in voting proxies, and not necessarily in making investment decisions. Our portfolio management teams (each, a “Portfolio Management Team”) base their determinations of whether to invest in a particular company on a variety of factors, and while corporate governance may be one such factor, it may not be the primary consideration.
Goldman Sachs Asset Management has adopted the policies and procedures set out below regarding the voting of proxies (the “Policy”). The Global Stewardship Team periodically reviews this Policy to ensure it continues to be consistent with our guiding principles.
B: The Proxy Voting Process
Public Equity Investments
Fundamental Equity Team
1 For purposes of this Policy, “Asset Management” refers, collectively, to the following legal entities:
Goldman Sachs Asset Management, L.P.; Goldman Sachs Asset Management International; Goldman Sachs Hedge Fund Strategies LLC; GS Investment Strategies, LLC; GSAM Stable Value, LLC; Goldman Sachs Asset Management (Singapore) Pte. Ltd; Goldman Sachs Asset Management (Hong Kong) Limited.; Goldman Sachs Asset Management Co. Ltd.; GSAM Services Private Limited; GS Investment Strategies Canada Inc.; Goldman Sachs Management (Ireland) Limited; Goldman Sachs Asset Management Australia Pty Ltd; Goldman Sachs Services Private Limited.; Goldman Sachs Bank Europe SE; and Goldman Sachs Asset Management Fund Services Limited.
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The Fundamental Equity Team views the analysis of corporate governance practices as an integral part of the investment research and stock valuation process. In forming their views on particular matters, these Portfolio Management Teams may consider applicable regional rules and practices, including codes of conduct and other guides, regarding proxy voting, in addition to the Guidelines and Recommendations (as defined below).
Quantitative Investment Strategies Portfolio Management Teams
The Quantitative Investment Strategies Portfolio Management Teams have decided to generally follow the Guidelines and Recommendations based on such Portfolio Management Teams’ investment philosophy and approach to portfolio construction, as well as their participation in the creation of the Guidelines. The Quantitative Investment Strategies Portfolio Management Teams may from time to time, however, review and individually assess any specific shareholder vote.
Fixed Income and Private Investments
Voting decisions with respect to client investments in fixed income securities and the securities of privately held issuers generally will be made by the relevant Portfolio Management Teams based on their assessment of the particular transactions or other matters at issue. Those Portfolio Management Teams may also adopt policies related to the fixed income or private investments they make that supplement this Policy.
GS Investment Strategies Portfolio Management
Voting decisions with respect to client investments in the securities of privately held issuers generally will be made by the relevant Portfolio Management Teams based on their assessment of the particular transactions or other matters at issue. To the extent the portfolio managers assume proxy voting responsibility with respect to publicly traded equity securities they will generally follow the Guidelines and Recommendations as discussed below unless an override is requested.
Alternative Investment and Manager Selection (“AIMS”) and
Externally Managed Strategies
Where we place client assets with managers outside of Asset Management, for example within our AIMS business unit, such external managers generally will be responsible for voting proxies in accordance with the managers’ own policies. AIMS may, however, retain proxy voting responsibilities where it deems appropriate or necessary under prevailing circumstances. To the extent AIMS portfolio managers assume proxy voting responsibility with respect to publicly traded equity securities they will follow the Guidelines and Recommendations as discussed below unless an override is requested. Any other voting decision will be conducted in accordance with AIMS’ policies governing voting decisions with respect to public and non-publicly traded equity securities held by their clients.
C: Implementation
We have retained a third-party proxy voting service (the “Proxy Service”) to assist in the implementation of certain proxy voting-related functions, including, without limitation, operational, recordkeeping and reporting services. Among its responsibilities, the Proxy Service prepares a written analysis and recommendation (a “Recommendation”) of each proxy vote that reflects the Proxy Service’s application of the Guidelines to the particular proxy issues. In addition, in order to facilitate the casting of votes in an efficient manner, the Proxy Service generally prepopulates and automatically submits votes for all proxy matters in accordance with such Recommendations, subject to our ability to recall such automatically submitted votes. If the Proxy Service or Asset Management becomes aware that an issuer has filed, or will file, additional proxy solicitation materials sufficiently in advance of the voting deadline, we will generally endeavor to consider such information where such information is viewed as material in our discretion when casting its vote, which may, but need not, result in a change to the Recommendation, which may take the form of an override (as described below) or a revised Recommendation issued by the Proxy Service. We retain the responsibility for proxy voting decisions. We conduct an annual due diligence meeting with the Proxy Service to review the processes and procedures the Proxy Service follows when making proxy voting recommendations based on the Guidelines and to discuss any material changes in the services, operations, staffing or processes.
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Our Portfolio Management Teams generally cast proxy votes consistently with the Guidelines and the Recommendations. Each Portfolio Management Team, however, may on certain proxy votes seek approval to diverge from the Guidelines or a Recommendation by following a process that seeks to ensure that override decisions are not influenced by any conflict of interest. As a result of the override process, different Portfolio Management Teams may vote differently for particular votes for the same company. In addition, the Global Stewardship Team may on certain proxy votes also seek approval to diverge from the Guidelines or a Recommendation and follow the override process described above that seeks to ensure these decisions are not influenced by any conflict of interest. In these instances, all shares voted are voted in the same manner.
Our clients who have delegated voting responsibility to us with respect to their account may from time to time contact their client representative if they would like to direct us to vote in a particular manner for a particular solicitation. We will use commercially reasonable efforts to vote according to the client’s request in these circumstances, however, our ability to implement such voting instruction will be dependent on operational matters such as the timing of the request.
From time to time, our ability to vote proxies may be affected by regulatory requirements and compliance, legal or logistical considerations. As a result, from time to time, we may determine that it is not practicable or desirable to vote proxies. In certain circumstances, such as if a security is on loan through a securities lending program, the Portfolio Management Teams may not be able to participate in certain proxy votes unless the shares of the particular issuer are recalled in time to cast the vote. A determination of whether to seek a recall will be based on whether the applicable Portfolio Management Team determines that the benefit of voting outweighs the costs, lost revenue, and/or other detriments of retrieving the securities, recognizing that the handling of such recall requests is beyond our control and may not be satisfied in time for us to vote the shares in question.
We disclose our voting publicly each year in a filing with the US Securities and Exchange Commission and on our website for all Goldman Sachs Asset Management US registered mutual funds. We also generally disclose our voting publicly on a quarterly basis on our website for company proxies voted according to the Guidelines and Recommendations.
D. Conflicts of Interest
Goldman Sachs Asset Management has implemented processes designed to prevent conflicts of interest from influencing its proxy voting decisions. These processes include information barriers as well as the use of the Guidelines and Recommendations and the override process described above in instances when a Portfolio Management Team is interested in voting in a manner that diverges from the initial Recommendation based on the Guidelines. To mitigate perceived or potential conflicts of interest when a proxy is for shares of The Goldman Sachs Group Inc. or a Goldman Sachs Asset Management managed fund, we will generally instruct that such shares be voted in the same proportion as other shares are voted with respect to a proposal, subject to applicable legal, regulatory and operational requirements.
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PART II
GOLDMAN SACHS ASSET MANAGEMENT’S PROXY VOTING GUIDELINES SUMMARY
The following is a summary of the material Proxy Voting Guidelines (the “Guidelines”), which form the substantive basis of our Policy and Procedures on Proxy Voting for Investment Advisory Clients (the “Policy”). As described in the main body of the Policy, one or more Portfolio Management Teams and/or the Global Stewardship Team may diverge from the Guidelines and a related Recommendation on any particular proxy vote or in connection with any individual investment decision in accordance with the Policy.
Region: Americas
The following section is a summary of the Guidelines, which form the substantive basis of the Policy with respect to North, Central and South American public equity investments of operating and/or holding companies Applying these guidelines is subject to certain regional and country-specific exceptions and modifications and is not inclusive of all considerations in each market.
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Business Items |
Auditor Ratification
Vote FOR proposals to ratify auditors, unless any of the following apply within the last year:
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An auditor has a financial interest in or association with the company, and is therefore not independent; |
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There is reason to believe that the independent auditor has rendered an opinion that is neither accurate nor indicative of the company’s financial position; |
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Poor accounting practices are identified that rise to a serious level of concern, such as: fraud; misapplication of GAAP; or material weaknesses identified in Section 404 disclosures; or |
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Fees for non-audit services are excessive (generally over 50% or more of the audit fees). |
Vote CASE-BY-CASE on shareholder proposals asking companies to prohibit or limit their auditors from engaging in non-audit services or asking for audit firm rotation.
Reincorporation Proposals
We may support management proposals to reincorporate as long as the reincorporation would not substantially diminish shareholder rights. We may not support shareholder proposals for reincorporation unless the current state of incorporation is substantially less shareholder friendly than the proposed reincorporation, there is a strong economic case to reincorporate or the company has a history of making decisions that are not shareholder friendly.
Exclusive Venue for Shareholder Lawsuits
Generally vote FOR on exclusive venue proposals, taking into account:
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Whether the company has been materially harmed by shareholder litigation outside its jurisdiction of incorporation, based on disclosure in the company’s proxy statement; |
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Whether the company has the following good governance features: |
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Majority independent board; |
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Independent key committees; |
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An annually elected board; |
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A majority vote standard in uncontested director elections; |
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The absence of a poison pill, unless the pill was approved by shareholders; and/or |
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Separate Chairman CEO role or, if combined, an independent chairman with clearly delineated duties. |
Virtual Meetings
Generally vote FOR proposals allowing for the convening of hybrid* shareholder meetings if it is clear that it is not the intention to hold virtual-only AGMs. Generally vote AGAINST proposals allowing for the convening of virtual-only* shareholder meetings.
* The phrase “virtual-only shareholder meeting” refers to a meeting of shareholders that is held exclusively through the use of online technology without a corresponding in-person meeting. The term “hybrid shareholder meeting” refers to an in-person, or physical, meeting in which shareholders are permitted to participate online.
Public Benefit Corporation Proposals
Generally vote FOR management proposals and CASE-BY-CASE on shareholder proposals related to the conversion of the company into a public benefit corporation.
Transact Other Business
Vote AGAINST other business when it appears as a voting item.
Administrative Requests
Generally vote FOR non-contentious administrative management requests.
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Board of Directors |
The board of directors should promote the interests of shareholders by acting in an oversight and/or advisory role; should consist of a majority of independent directors and/or meet local best practice expectations; and should be held accountable for actions and results related to their responsibilities. Vote on director nominees should be determined on a CASE-BY-CASE basis.
Voting on Director Nominees in Uncontested Elections
Board Composition
We generally believe diverse teams have the potential to outperform and we expect the companies that we invest in to focus on the importance of diversity. When evaluating board composition, we believe a diversity of ethnicity, gender and experience is an important consideration. We encourage companies to disclose the composition of their board in the proxy statement and may vote against members of the board without disclosure. See below how we execute our vote at companies that do not meet our diversity expectations.
Vote AGAINST or WITHHOLD from members of the Nominating Committee:
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At companies incorporated in the US if the board does not have at least 10% women directors and at least one other diverse board director; |
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At companies within the S&P 500, if, in addition to our gender expectations, the board does not have at least one diverse director from an underrepresented ethnic group; |
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At companies not incorporated in the US, if the board does not have at least 10% women directors or does not meet the requirements of local listing rules or corporate governance codes or national targets |
Vote AGAINST or WITHHOLD from the full board at companies incorporated in the US that do not have at least one woman director.
Vote AGAINST or WITHHOLD from individual directors who:
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Sit on more than five public company boards; |
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Are CEOs of public companies who sit on the boards of more than two public companies besides their own--withhold only at their outside boards. |
Vote AGAINST or WITHHOLD from members of the Nominating Committee if the average board tenure exceeds 15 years, and there has not been a new nominee in the past 5 years.
Director Independence
At companies incorporated in the US, where applicable, the New York Stock Exchange or NASDAQ Listing Standards definition is to be used to classify directors as inside directors, affiliated outside directors, or independent outside directors.
Additionally, we will consider compensation committee interlocking directors to be affiliated (defined as CEOs who sit on each other’s compensation committees).
Vote AGAINST or WITHHOLD from inside directors and affiliated outside directors (as described above) when:
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The inside director or affiliated outside director serves on the Audit, Compensation or Nominating Committees; and |
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The company lacks an Audit, Compensation or Nominating Committee so that the full board functions as such committees and inside directors or affiliated outside directors are participating in voting on matters that independent committees should be voting on. |
Director Accountability
Vote AGAINST or WITHHOLD from individual directors who attend less than 75% of the board and committee meetings without a disclosed valid excuse.
Generally, vote FOR the bundled election of management nominees, unless adequate disclosures of the nominees have not been provided in a timely manner or if one or more of the nominees does not meet the expectation of our policy.
Other items considered for an AGAINST vote include specific concerns about the individual or the company, such as criminal wrongdoing or breach of fiduciary responsibilities, sanctions from government or authority, violations of laws and regulations, the presence of inappropriate related party transactions, or other issues related to improper business practices
Vote AGAINST or WITHHOLD from members of the full board or appropriate committee (or only the independent chairman or lead director as may be appropriate in situations such as where there is a classified board and members of the appropriate committee are not up for re-election or the appropriate committee is comprised of the entire board) for the below reasons. New nominees will be considered on a case-by-case basis. Extreme cases may warrant a vote against the entire board.
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Material failures of governance, stewardship, or fiduciary responsibilities at the company, including but not limited to violations of the United Nations Global Compact principles and/or other significant global standards and failure to disclose material environmental, social and governance information; |
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Egregious actions related to the director(s)’ service on other boards that raise substantial doubt about his or her ability to effectively oversee management and serve the best interests of shareholders at any company; |
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The board failed to act on a shareholder proposal that received approval of the majority of shares cast for the previous two consecutive years (a management proposal with other than a FOR recommendation by management will not be considered as sufficient action taken); an adopted proposal that is substantially similar to the original shareholder proposal will be deemed sufficient; (vote against members of the committee of the board that is responsible for the issue under consideration). If we did not support the shareholder proposal in both years, we will still vote against the committee member(s). |
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The company’s poison pill has a dead-hand or modified dead-hand feature for two or more years. Vote against/withhold every year until this feature is removed; however, vote against the poison pill if there is one on the ballot with this feature rather than the director; |
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The board adopts or renews a poison pill without shareholder approval, does not commit to putting it to shareholder vote within 12 months of adoption (or in the case of a newly public company, does not commit to put the pill to a shareholder vote within 12 months following the IPO), or reneges on a commitment to put the pill to a vote, and has not yet received a withhold/against recommendation for this issue; |
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The board failed to act on takeover offers where the majority of the shareholders tendered their shares; |
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The company does not disclose various components of current emissions, a proxy for a company’s dependency on fossil fuels and other sources of greenhouse gasses (Scope 1, Scope 2, Scope 3 emissions), material to the company’s business |
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If in an extreme situation the board lacks accountability and oversight, coupled with sustained poor performance relative to peers. |
Committee Responsibilities and Expectations
Companies should establish committees to oversee areas such as audit, executive and non-executive compensation, director nominations and ESG oversight. The responsibilities of the committees should be publicly disclosed.
Audit Committee
Vote AGAINST or WITHHOLD from the members of the Audit Committee if:
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The non-audit fees paid to the auditor are excessive (generally over 50% or more of the audit fees); |
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The company receives an adverse opinion on the company’s financial statements from its auditor and there is not clear evidence that the situation has been remedied; |
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There is excessive pledging or hedging of stock by executives; |
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There is persuasive evidence that the Audit Committee entered into an inappropriate indemnification agreement with its auditor that limits the ability of the company, or its shareholders, to pursue legitimate legal recourse against the audit firm; or |
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No members of the Audit Committee hold sufficient financial expertise. |
Vote CASE-BY-CASE on members of the Audit Committee and/or the full board if poor accounting practices, which rise to a level of serious concern are identified, such as fraud, misapplication of GAAP and material weaknesses identified in Section 404 disclosures.
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Examine the severity, breadth, chronological sequence and duration, as well as the company’s efforts at remediation or corrective actions, in determining whether negative vote recommendations are warranted against the members of the Audit Committee who are responsible for the poor accounting practices, or the entire board.
Compensation Committee
See section 3 on Executive and Non-Executive compensation for reasons to withhold from members of the Compensation Committee.
Nominating/Governance Committee
Vote AGAINST or WITHHOLD from the members of the Nominating/Governance Committee if:
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The company has opted into, or failed to opt out of, state laws requiring a classified board structure; |
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At the previous board election, any director received more than 50% withhold/against votes of the shares cast and the company has failed to address the underlying issue(s) that caused the high withhold/against vote; |
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The board does not meet our diversity expectations; |
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The board amends the company’s bylaws or charter without shareholder approval in a manner that materially diminishes shareholders’ rights or could adversely impact shareholders. |
Voting on Director Nominees in Contested Elections
Vote on a CASE-BY-CASE basis in contested elections of directors, e.g., the election of shareholder nominees or the dismissal of incumbent directors, determining which directors are best suited to add value for shareholders.
The analysis will generally be based on, but not limited to, the following major decision factors:
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Company performance relative to its peers; |
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Strategy of the incumbents versus the dissidents; |
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Independence of board candidates; |
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Experience and skills of board candidates; |
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Governance profile of the company; |
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Evidence of management entrenchment; |
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Responsiveness to shareholders; |
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Whether a takeover offer has been rebuffed; and |
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Whether minority or majority representation is being sought. |
Proxy Access
Vote CASE-BY-CASE on shareholder or management proposals asking for proxy access.
We may support proxy access as an important right for shareholders and as an alternative to costly proxy contests and as a method for us to vote for directors on an individual basis, as appropriate, rather than voting on one slate or the other. While this could be an important shareholder right, the following factors will be taken into account when evaluating the shareholder proposals:
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The ownership thresholds, percentage and duration proposed (we generally will not support if the ownership threshold is less than 3%); |
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The maximum proportion of directors that shareholders may nominate each year (we generally will not support if the proportion of directors is greater than 25%); and |
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Other restricting factors that when taken in combination could serve to materially limit the proxy access provision. |
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We will take the above factors into account when evaluating proposals proactively adopted by the company or in response to a shareholder proposal to adopt or amend the right. A vote against governance committee members could result if provisions exist that materially limit the right to proxy access.
Reimbursing Proxy Solicitation Expenses
Vote CASE-BY-CASE on proposals to reimburse proxy solicitation expenses. When voting in conjunction with support of a dissident slate, vote FOR the reimbursement of all appropriate proxy solicitation expenses associated with the election.
Other Board Related Proposals (Management and Shareholder)
Independent Board Chair (for applicable markets)
We will generally vote AGAINST shareholder proposals requiring that the chairman’s position be filled by an independent director, if the company satisfies 3 of the 4 following criteria:
● |
Two-thirds independent board, or majority in countries where employee representation is common practice; |
● |
A designated, or a rotating, lead director, elected by and from the independent board members with clearly delineated and comprehensive duties; |
● |
Fully independent key committees; and/or |
● |
Established, publicly disclosed, governance guidelines and director biographies/profiles. |
Shareholder Proposals Regarding Board Declassification
We will generally vote FOR proposals requesting that the board adopt a declassified board structure.
Majority Vote Shareholder Proposals
We will vote FOR proposals requesting that the board adopt majority voting in the election of directors provided it does not conflict with the state law where the company is incorporated. We also look for companies to adopt a post-election policy outlining how the company will address the situation of a holdover director.
Cumulative Vote Shareholder Proposals
We will generally vote FOR shareholder proposals to restore or provide cumulative unless:
● |
The company has adopted (i) majority vote standard with a carve-out for plurality voting in situations where there are more nominees than seats and (ii) a director resignation policy to address failed elections. |
3. |
Executive and Non- Executive Compensation |
Pay Practices
Good pay practices should align management’s interests with long-term shareholder value creation. Detailed disclosure of compensation criteria is preferred; proof that companies follow the criteria should be evident and retroactive performance target changes without proper disclosure is not viewed favorably. Compensation practices should allow a company to attract and retain proven talent. Some examples of poor pay practices include: abnormally large bonus payouts without justifiable performance linkage or proper disclosure, egregious employment contracts, excessive severance and/or change in control provisions, repricing or replacing of underwater stock options/stock appreciation rights without prior shareholder approval, and excessive perquisites. A company should also have an appropriate balance of short-term vs. long-term metrics and the metrics should be aligned with business goals and objectives.
If the company maintains problematic or poor pay practices, generally vote:
● |
AGAINST Management Say on Pay (MSOP) Proposals; or |
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● |
AGAINST an equity-based incentive plan proposal if excessive non-performance-based equity awards are the major contributor to a pay-for-performance misalignment. |
● |
If no MSOP or equity-based incentive plan proposal item is on the ballot, vote AGAINST/WITHHOLD from compensation committee members. |
Equity Compensation Plans
Vote CASE-BY-CASE on equity-based compensation plans. Evaluation takes into account potential plan cost, plan features and grant practices. While a negative combination of these factors could cause a vote AGAINST, other reasons to vote AGAINST the equity plan could include the following factors:
● |
The plan permits the repricing of stock options/stock appreciation rights (SARs) without prior shareholder approval; or |
● |
There is more than one problematic material feature of the plan, which could include one of the following: unfavorable change-in-control features, presence of gross ups and options reload. |
Advisory Vote on Executive Compensation (Say-on-Pay, MSOP) Management Proposals
Vote FOR annual frequency and AGAINST all proposals asking for any frequency less than annual.
Vote CASE-BY-CASE on management proposals for an advisory vote on executive compensation considering the following factors in the context of each company’s specific circumstances and the board’s disclosed rationale for its practices.
Factors Considered Include:
● |
Pay for Performance Disconnect; |
– |
We will consider there to be a disconnect based on a quantitative assessment of the following: CEO pay vs. TSR (“Total Shareholder Return”) and peers, CEO pay as a percentage of the median peer group or CEO pay vs. shareholder return over time. |
● |
Long-term equity-based compensation is 100% time-based; |
● |
Board’s responsiveness if company received 70% or less shareholder support in the previous year’s MSOP vote; |
● |
Abnormally large bonus payouts without justifiable performance linkage or proper disclosure; |
● |
Egregious employment contracts; |
● |
Excessive perquisites or excessive severance and/or change in control provisions; |
● |
Repricing or replacing of underwater stock options without prior shareholder approval; |
● |
Egregious pension/SERP (supplemental executive retirement plan) payouts; |
● |
Extraordinary relocation benefits; |
● |
Internal pay disparity; and |
● |
Lack of transparent disclosure of compensation philosophy and goals and targets, including details on short-term and long-term performance incentives. |
Other Compensation Proposals and Policies
Employee Stock Purchase Plans -- Non-Qualified Plans
Vote CASE-BY-CASE on nonqualified employee stock purchase plans taking into account the following factors:
● |
Broad-based participation; |
● |
Limits on employee contributions; |
● |
Company matching contributions; and |
● |
Presence of a discount on the stock price on the date of purchase. |
Option Exchange Programs/Repricing Options
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Vote CASE-BY-CASE on management proposals seeking approval to exchange/reprice options, taking into consideration:
● |
Historic trading patterns--the stock price should not be so volatile that the options are likely to be back “in-the-money” over the near term; |
● |
Rationale for the re-pricing; |
● |
If it is a value-for-value exchange; |
● |
If surrendered stock options are added back to the plan reserve; |
● |
Option vesting; |
● |
Term of the option--the term should remain the same as that of the replaced option; |
● |
Exercise price--should be set at fair market or a premium to market; |
● |
Participants--executive officers and directors should be excluded. |
Vote FOR shareholder proposals to put option repricings to a shareholder vote.
Stock Retention Holding Period
Vote FOR shareholder proposals asking for a policy requiring that senior executives retain a significant percentage of shares acquired through equity compensation programs if the policy requests retention for two years or less following the termination of their employment (through retirement or otherwise) and a holding threshold percentage of 50% or less.
Also consider whether the company has any holding period, retention ratio, or officer ownership requirements in place and the terms/provisions of awards already granted.
Elimination of Accelerated Vesting in the Event of a Change in Control
Vote AGAINST shareholder proposals seeking a policy eliminating the accelerated vesting of time-based equity awards in the event of a change-in-control.
Performance-based Equity Awards and Pay-for-Superior-Performance Proposals
Generally vote FOR unless there is sufficient evidence that the current compensation structure is already substantially performance-based. We consider performance-based awards to include awards that are tied to shareholder return or other metrics that are relevant to the business.
Say on Supplemental Executive Retirement Plans (SERP)
Generally vote AGAINST proposals asking for shareholder votes on SERP.
Compensation Committee
Vote AGAINST or WITHHOLD from the members of the Compensation Committee if:
● |
We voted against the company’s MSOP in the previous year, the company’s previous MSOP received significant opposition of votes cast and we are voting against this year’s MSOP; |
● |
The board implements a MSOP on a less frequent basis than the frequency that received the plurality of votes cast |
4. |
Shareholders Rights and Defenses |
Shareholder Ability to Act by Written Consent
11
Generally vote FOR shareholder proposals that provide shareholders with the ability to act by written consent, unless:
● |
The company already gives shareholders the right to call special meetings at a threshold of 25% or lower; and |
● |
The company has a history of strong governance practices. |
Special Meetings Arrangements
Generally vote FOR management proposals that provide shareholders with the ability to call special meetings.
Generally vote FOR shareholder proposals that provide shareholders with the ability to call special meetings at a threshold of 25% or lower if the company currently does not give shareholders the right to call special meetings. However, if a company already gives shareholders the right to call special meetings at a threshold of at least 25%, vote AGAINST shareholder proposals to further reduce the threshold.
Generally vote AGAINST management proposals seeking shareholder approval for the company to hold special meetings with 14 days notice unless the company offers shareholders the ability to vote by electronic means and a proposal to reduce the period of notice to not less than 14 days has received majority support.
Advance Notice Requirements for Shareholder Proposals/Nominations
Vote CASE-BY-CASE on advance notice proposals, giving support to proposals that allow shareholders to submit proposals/nominations reasonably close to the meeting date and within the broadest window possible, recognizing the need to allow sufficient notice for company, regulatory and shareholder review.
Shareholder Voting Requirements
Vote AGAINST proposals to require a supermajority shareholder vote. Generally vote FOR management and shareholder proposals to reduce supermajority vote requirements.
Poison Pills
Vote FOR shareholder proposals requesting that the company submit its poison pill to a shareholder vote or redeem it, unless the company has:
● |
a shareholder-approved poison pill in place; or |
● |
adopted a policy concerning the adoption of a pill in the future specifying certain shareholder friendly provisions. |
Vote FOR shareholder proposals calling for poison pills to be put to a vote within a time period of less than one year after adoption.
Vote CASE-BY-CASE on management proposals on poison pill ratification, focusing on the features of the shareholder rights plan.
In addition, the rationale for adopting the pill should be thoroughly explained by the company. In examining the request for the pill, take into consideration the company’s existing governance structure, including: board independence, existing takeover defenses, and any problematic governance concerns.
5. |
Strategic Transactions and Capital Structures |
Reorganizations/Restructurings
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
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Mergers and Acquisitions
Vote CASE-BY-CASE on mergers and acquisitions taking into account the following based on publicly available information:
● |
Valuation; |
● |
Market reaction; |
● |
Strategic rationale; |
● |
Management’s track record of successful integration of historical acquisitions; |
● |
Presence of conflicts of interest; and |
● |
Governance profile of the combined company. |
Dual Class Structures
Vote FOR resolutions that seek to maintain or convert to a one-share, one-vote capital structure.
Vote AGAINST requests for the creation or continuation of dual-class capital structures or the creation of new or additional super voting shares.
Share Issuance Requests
General Issuances:
Vote FOR issuance requests with preemptive rights to a maximum of 100% over currently issued capital or any stricter limit set in local best practice recommendations or law.
Vote FOR issuance requests without preemptive rights to a maximum of 20% of currently issued capital or any stricter limit set in local best practice recommendations or law.
Specific Issuances:
Vote on a CASE-BY-CASE basis on all requests, with or without preemptive rights.
Increases in Authorized Capital
Vote FOR non-specific proposals to increase authorized capital up to 100% over the current authorization unless the increase would leave the company with less than 30% of its new authorization outstanding, or any stricter limit set in local best practice recommendations or law.
Vote FOR specific proposals to increase authorized capital to any amount, unless:
● |
The specific purpose of the increase (such as a share-based acquisition or merger) does not meet guidelines for the purpose being proposed; or |
● |
The increase would leave the company with less than 30% of its new authorization outstanding after adjusting for all proposed issuances or any stricter limit set in local best practice recommendations or law. |
Vote AGAINST proposals to adopt unlimited capital authorizations.
Reduction of Capital
Vote FOR proposals to reduce capital for routine accounting purposes unless the terms are unfavorable to shareholders.
Vote proposals to reduce capital in connection with corporate restructuring on a CASE-BY-CASE basis.
Preferred Stock
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Vote FOR the creation of a new class of preferred stock or for issuances of preferred stock up to 50% of issued capital unless the terms of the preferred stock would adversely affect the rights of existing shareholders.
Vote FOR the creation/issuance of convertible preferred stock as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote AGAINST the creation of a new class of preference shares that would carry superior voting rights to the common shares.
Vote AGAINST the creation of blank check preferred stock unless the board clearly states that the authorization will not be used to thwart a takeover bid.
Vote proposals to increase blank check preferred authorizations on a CASE-BY-CASE basis.
Debt Issuance Requests
Vote non-convertible debt issuance requests on a CASE-BY-CASE basis, with or without preemptive rights.
Vote FOR the creation/issuance of convertible debt instruments as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote FOR proposals to restructure existing debt arrangements unless the terms of the restructuring would adversely affect the rights of shareholders.
Increase in Borrowing Powers
Vote proposals to approve increases in a company’s borrowing powers on a CASE-BY-CASE basis.
Share Repurchase Plans
We will generally recommend FOR share repurchase programs taking into account whether:
● |
The share repurchase program can be used as a takeover defense; |
● |
There is clear evidence of historical abuse; |
● |
There is no safeguard in the share repurchase program against selective buybacks; |
● |
Pricing provisions and safeguards in the share repurchase program are deemed to be unreasonable in light of market practice. |
Reissuance of Repurchased Shares
Vote FOR requests to reissue any repurchased shares unless there is clear evidence of abuse of this authority in the past.
Capitalization of Reserves for Bonus Issues/Increase in Par Value
Vote FOR requests to capitalize reserves for bonus issues of shares or to increase par value.
Reorganizations/Restructurings
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
Reincorporation Proposals
Vote reincorporation proposals on a CASE-BY-CASE basis.
Related-Party Transactions
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Vote related-party transactions on a CASE-BY-CASE basis, considering factors including, but not limited to, the following:
● |
The parties on either side of the transaction; |
● |
The nature of the asset to be transferred/service to be provided; |
● |
The pricing of the transaction (and any associated professional valuation); |
● |
The views of independent directors (where provided); |
● |
The views of an independent financial adviser (where appointed); |
● |
Whether any entities party to the transaction (including advisers) is conflicted; and The stated rationale for the transaction, including discussions of timing |
Common and Preferred Stock Authorization
Generally vote FOR proposals to increase the number of shares of common stock authorized for issuance.
Generally vote FOR proposals to increase the number of shares of preferred stock, as long as there is a commitment to not use the shares for anti-takeover purposes.
6. |
Environmental and Social Issues |
Overall Approach
Proposals considered under this category could include, among others, reports on:
1) |
employee labor and safety policies; |
2) |
impact on the environment of the company’s production or manufacturing operations; |
3) |
societal impact of products manufactured; |
4) |
risks throughout the supply chain or operations including labor practices, animal treatment practices within food production and conflict minerals; and |
5) |
overall board structure, including diversity. |
When evaluating environmental and social shareholder proposals, the following factors are generally considered:
● |
The company’s current level of publicly available disclosure, including if the company already discloses similar information through existing reports or policies; |
● |
If the company has implemented or formally committed to the implementation of a reporting program based on the Sustainability Accounting Standards Board’s (SASB) materiality standards, the Task Force on Climate-related Financial Disclosure’s (TCFD) recommendations, or a similar standard; |
● |
Whether adoption of the proposal is likely to enhance or protect shareholder value; |
● |
Whether the information requested concerns business issues that relate to a meaningful percentage of the company’s business; |
● |
The degree to which the company’s stated position on the issues raised in the proposal could affect its reputation or sales, or leave it vulnerable to a boycott or selective purchasing; |
● |
Whether the company has already responded in some appropriate manner to the request embodied in the proposal; |
● |
What other companies in the relevant industry have done in response to the issue addressed in the proposal; |
● |
Whether the proposal itself is well framed and the cost of preparing the report is reasonable; |
● |
Whether the subject of the proposal is best left to the discretion of the board; |
● |
Whether the company has material fines or violations in the area and if so, if appropriate actions have already been taken to remedy going forward; |
● |
Whether providing this information would reveal proprietary or confidential information that would place the company at a competitive disadvantage. |
15
Environmental Issues
Climate Transition Plans
Generally vote CASE-BY-CASE on management proposed climate transition plans. When evaluating management proposed plans, the following factors are generally considered:
● |
If the company has detailed disclosure of the governance, strategy, risk mitigation efforts, and metrics and targets based on the TCFD’s recommendations, or a similar standard; |
● |
If the company has detailed disclosure of their current emissions data based on the SASB materiality framework; and |
● |
If the company has detailed disclosure in line with Paris Agreement goals. |
Generally vote CASE-BY-CASE on shareholder proposals requesting climate transition plans. When evaluating these shareholder proposals, the following factors are generally considered:
● |
The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
● |
If the proposal asks for detailed disclosure according to the TCFD’s recommendations; |
● |
If the proposal asks for detailed disclosure of the company’s current emissions data based on the SASB materiality framework; |
● |
If the proposal asks for long-term targets, as well as short and medium term milestones; |
● |
If the proposal asks for targets to be aligned to a globally accepted framework, such as Paris Aligned or Net Zero; |
● |
If the proposal asks for targets to be approved by the Science Based Target Initiative (“SBTi”); |
● |
If the proposal seeks to add reasonable transparency and is not onerous or overly prescriptive; and |
● |
Whether the proposal is binding or non-binding. |
Environmental Sustainability Reporting
Generally vote FOR shareholders proposals requesting the company to report on its policies, initiatives and oversight mechanisms related to environmental sustainability, including the impacts of climate change and biodiversity loss. The following factors will be considered:
● |
The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
● |
If the company has formally committed to the implementation of a reporting program based on the SASB materiality standards, the TCFD’s recommendations, or a similar standard within a specified time frame; |
● |
If the company’s current level of disclosure is comparable to that of its industry peers; and |
● |
If there are significant controversies, fines, penalties, or litigation associated with the company’s environmental performance. |
Other Environmental Proposals
Vote CASE-BY-CASE on the following shareholder proposals if relevant to the company:
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● |
Seeking information on the financial, physical, or regulatory risks a company faces related to climate change on its operations and investment, or on how the company identifies, measures and manages such risks; |
● |
Calling for the reduction of Greenhouse Gas (GHG) emissions; |
● |
Seeking reports on responses to regulatory and public pressures surrounding climate change, and for disclosure of research that aided in setting company policies around climate change; |
● |
Requesting an action plan including science based targets and a commitment to net zero emissions by 2050 or earlier; |
● |
Requesting a report/disclosure of goals on GHG emissions from company operations and/or products; |
● |
Requesting a company report on its energy efficiency policies; and |
● |
Requesting reports on the feasibility of developing renewable energy resources. |
Social Issues
Board and Workforce Demographics
A company should have a clear, public Equal Employment Opportunity (EEO) statement and/or diversity policy. Generally vote FOR proposals seeking to amend a company’s EEO statement or diversity policies to additionally prohibit discrimination based on sexual orientation and/or gender identity.
Generally vote FOR proposals requesting reports on a company’s efforts to diversify the board, unless:
● |
The gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business; and |
● |
The board already reports on its nominating procedures and gender and racial minority initiatives on the board. |
Gender Pay Gap
Generally vote CASE-BY-CASE on proposals requesting reports on a company’s pay data by gender, or a report on a company’s policies and goals to reduce any gender pay gap, taking into account:
● |
The company’s current policies and disclosure related to both its diversity and inclusion policies and practices and its compensation philosophy and fair and equitable compensation practices; |
● |
Whether the company has been the subject of recent controversy, litigation or regulatory actions related to gender pay gap issues; and |
● |
Whether the company’s reporting regarding gender pay gap policies or initiatives is lagging its peers. |
Labor, Human and Animal Rights Standards
Generally vote FOR proposals requesting a report on company or company supplier labor, human, and/or animal rights standards and policies, or on the impact of its operations on society, unless such information is already publicly disclosed considering:
● |
The degree to which existing relevant policies and practices are disclosed; |
● |
Whether or not existing relevant policies are consistent with internationally recognized standards; |
● |
Whether company facilities and those of its suppliers are monitored and how; |
● |
Company participation in fair labor organizations or other internationally recognized human rights initiatives; |
● |
Scope and nature of business conducted in markets known to have higher risk of workplace labor/human rights abuse; |
● |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; |
● |
The scope of the request; and |
● |
Deviation from industry sector peer company standards and practices. |
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Generally vote CASE-BY-CASE on shareholder proposals requesting reports about a company’s use of mandatory arbitrations in employment claims, taking into account the company’s existing policies and disclosures of policies.
Generally vote CASE-BY-CASE on shareholder proposals requesting reports on the actions taken by a company to prevent sexual and other forms of harassment or on the risks posed by the company’s failure to take such actions, taking into account the company’s existing policies and disclosures of policies.
Racial Equity Audit
• |
Generally vote CASE-BY-CASE on shareholder proposals requesting the board oversee a racial equity audit. While we believe the decision to initiate an independent audit is best left to management judgment under the oversight of the board of directors, the following factors are generally considered: |
• |
The degree to which existing relevant policies and practices are disclosed; |
• |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; and |
• |
Whether the gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business. |
Political Contributions and Trade Association Spending/Lobbying Expenditures and Initiatives
We generally believe that it is the role of boards and management to determine the appropriate level of disclosure of all types of corporate political activity. When evaluating these proposals, we consider the prescriptive nature of the proposal and the overall benefit to shareholders along with a company’s current disclosure of policies, practices and oversight.
Generally vote AGAINST proposals asking the company to affirm political nonpartisanship in the workplace so long as:
● |
There are no recent, significant controversies, fines or litigation regarding the company’s political contributions or trade association spending; and |
● |
The company has procedures in place to ensure that employee contributions to company-sponsored political action committees (PACs) are strictly voluntary and prohibits coercion. |
Generally vote AGAINST proposals requesting increased disclosure of a company’s policies with respect to political contributions, lobbying and trade association spending as long as:
● |
There is no significant potential threat or actual harm to shareholders’ interests; |
● |
There are no recent significant controversies or litigation related to the company’s political contributions or governmental affairs; and |
● |
There is publicly available information to assess the company’s oversight related to such expenditures of corporate assets. |
We generally will vote AGAINST proposals asking for detailed disclosure of political contributions or trade association or lobbying expenditures.
We generally will vote AGAINST proposals barring the company from making political contributions. Businesses are affected by legislation at the federal, state, and local level and barring political contributions can put the company at a competitive disadvantage.
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Region: Europe, Middle East and Africa (EMEA) Proxy Items
The following section is a broad summary of the Guidelines, which form the basis of the Policy with respect to EMEA public equity investments of operating and/or holding companies. Applying these guidelines is subject to certain regional and country-specific exceptions and modifications and is not inclusive of all considerations in each market.
1. |
Business Items |
Financial Results/Director and Auditor Reports
Vote FOR approval of financial statements and director and auditor reports, unless:
● |
There are serious concerns about the accounts presented, audit procedures used or audit opinion rendered; or |
● |
The company is not responsive to shareholder questions about specific items that should be publicly disclosed. |
Appointment of Auditors and Auditor Fees
Vote FOR the re-election of auditors and proposals authorizing the board to fix auditor fees unless:
● |
There are serious concerns about the accounts presented, audit procedures used or audit opinion rendered; |
● |
There is reason to believe that the auditor has rendered an opinion that is neither accurate nor indicative of the company’s financial position; |
● |
Name of the proposed auditor has not been published; |
● |
The auditors are being changed without explanation; |
● |
Non-audit-related fees are substantial, or are in excess of standard annual audit-related fees, or in excess of permitted local limits and guidelines; or |
● |
The appointment of external auditors if they have previously served the company in an executive capacity or can otherwise be considered affiliated with the company. |
Appointment of Internal Statutory Auditors
Vote FOR the appointment or re-election of statutory auditors, unless:
● |
There are serious concerns about the statutory reports presented or the audit procedures used; |
● |
Questions exist concerning any of the statutory auditors being appointed; or |
● |
The auditors have previously served the company in an executive capacity or can otherwise be considered affiliated with the company. |
Reincorporation Proposals
Vote reincorporation proposals on a CASE-BY-CASE basis
Allocation of Income
Vote FOR approval of the allocation of income, unless:
● |
The dividend payout ratio has been consistently low without adequate explanation; or |
● |
The payout is excessive given the company’s financial position. |
Stock (Scrip) Dividend Alternative
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Vote FOR most stock (scrip) dividend proposals.
Vote AGAINST proposals that do not allow for a cash option unless management demonstrates that the cash option is harmful to shareholder value.
Amendments to Articles of Association
Vote amendments to the articles of association on a CASE-BY-CASE basis.
Change in Company Fiscal Term
Vote FOR resolutions to change a company’s fiscal term unless a company’s motivation for the change is to postpone its annual general meeting.
Lower Disclosure Threshold for Stock Ownership
Vote AGAINST resolutions to lower the stock ownership disclosure threshold below 5% unless specific reasons exist to implement a lower threshold.
Amend Quorum Requirements
Vote proposals to amend quorum requirements for shareholder meetings on a CASE-BY-CASE basis.
Virtual Meetings
Generally vote FOR proposals allowing for the convening of hybrid* shareholder meetings if it is clear that it is not the intention to hold virtual-only AGMs. Generally vote AGAINST proposals allowing for the convening of virtual-only* shareholder meetings.
* The phrase “virtual-only shareholder meeting” refers to a meeting of shareholders that is held exclusively through the use of online technology without a corresponding in-person meeting. The term “hybrid shareholder meeting” refers to an in-person, or physical, meeting in which shareholders are permitted to participate online.
Public Benefit Corporation Proposals
Generally vote FOR management proposals and CASE-BY-CASE on shareholder proposals related to the conversion of the company into a public benefit corporation.
Transact Other Business
Vote AGAINST other business when it appears as a voting item.
Administrative Requests
Generally vote FOR non-contentious administrative management requests.
2. |
Board of Directors |
The board of directors should promote the interests of shareholders by acting in an oversight and/or advisory role; should consist of a majority of independent directors and / or meet local best practice expectations; and should be held accountable for actions and results related to their responsibilities.
Voting on Director Nominees in Uncontested Elections
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Vote on director nominees should be determined on a CASE-BY-CASE basis taking into consideration the following:
● |
Adequate disclosure has not been provided in a timely manner; or |
● |
There are clear concerns over questionable finances or restatements; or |
● |
There have been questionable transactions or conflicts of interest; or |
● |
There are any records of abuses against minority shareholder interests; or |
● |
The board fails to meet minimum corporate governance standards; or |
● |
There are reservations about: |
o |
Director terms |
o |
Bundling of proposals to elect directors |
o |
Board independence |
o |
Disclosure of named nominees |
o |
Combined Chairman/CEO |
o |
Election of former CEO as Chairman of the board |
o |
Overboarded directors |
o |
Composition of committees |
o |
Director independence |
o |
Number of directors on the board |
o |
Lack of gender diversity on the board |
● |
Specific concerns about the individual or company, such as criminal wrongdoing or breach of fiduciary responsibilities; or |
● |
There are other considerations which may include sanction from government or authority, violations of laws and regulations, or other issues relate to improper business practice, failure to replace management, or egregious actions related to service on other boards. |
Board Composition
We generally believe diverse teams have the potential to outperform and we expect the companies that we invest in to focus on the importance of diversity. When evaluating board composition, we believe a diversity of ethnicity, gender and experience is an important consideration. We encourage companies to disclose the composition of their board in the proxy statement and may vote against members of the board without disclosure. See below how we execute our vote at companies that do not meet our diversity expectations.
Vote AGAINST members of the Nominating Committee:
● |
At companies if the board does not have at least 10% women directors, or does not meet the requirements of local listing rules or corporate governance codes or national targets; |
● |
At companies in the FTSE100 if the board does not have at least one director from an underrepresented minority ethnic background, in line with the Parker review guidelines. |
Employee and /or Labor Representatives
Vote FOR employee and/or labor representatives if they sit on either the audit or compensation committee and are required by law to be on those committees.
Vote AGAINST employee and/or labor representatives if they sit on either the audit or compensation committee, if they are not required to be on those committees.
Director Independence
Classification of Directors
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Executive Director
● |
Employee or executive of the company; |
● |
Any director who is classified as a non-executive, but receives salary, fees, bonus, and/or other benefits that are in line with the highest-paid executives of the company. |
Non-Independent Non-Executive Director (NED)
● |
Any director who is attested by the board to be a non-independent NED; |
● |
Any director specifically designated as a representative of a significant shareholder of the company; |
● |
Any director who is also an employee or executive of a significant shareholder of the company; |
● |
Beneficial owner (direct or indirect) of at least 10% of the company’s stock, either in economic terms or in voting rights (this may be aggregated if voting power is distributed among more than one member of a defined group, e.g., family members who beneficially own less than 10% individually, but collectively own more than 10%), unless market best practice dictates a lower ownership and/or disclosure threshold (and in other special market-specific circumstances); |
● |
Government representative; |
● |
Currently provides (or a relative provides) professional services to the company, to an affiliate of the company, or to an individual officer of the company or of one of its affiliates in excess of $10,000 per year; |
● |
Represents customer, supplier, creditor, banker, or other entity with which company maintains transactional/commercial relationship (unless company discloses information to apply a materiality test); |
● |
Any director who has conflicting or cross-directorships with executive directors or the chairman of the company; |
● |
Relative of a current employee of the company or its affiliates; |
● |
Relative of a former executive of the company or its affiliates; |
● |
A new appointee elected other than by a formal process through the General Meeting (such as a contractual appointment by a substantial shareholder); |
● |
Founder/co-founder/member of founding family but not currently an employee; |
● |
Former executive (a cooling off period may be applied); |
● |
Years of service is generally not a determining factor unless it is recommended best practice in a market and/or in extreme circumstances, in which case it may be considered; and |
● |
Any additional relationship or principle considered to compromise independence under local corporate governance best practice guidance. |
Independent NED
● |
No material connection, either directly or indirectly, to the company other than a board seat. |
Employee Representative
● |
Represents employees or employee shareholders of the company (classified as “employee representative” but considered a non-independent NED). |
Director Accountability
Vote AGAINST individual directors who attend less than 75% of the board and committee meetings without a disclosed valid excuse.
Generally, vote FOR the bundled election of management nominees, unless adequate disclosures of the nominees have not been provided in a timely manner or if one or more of the nominees does not meet the expectation of our policy.
Other items considered for an AGAINST vote include specific concerns about the individual or the company, such as criminal wrongdoing or breach of fiduciary responsibilities, sanctions from government or authority, violations of
22
laws and regulations, the presence of inappropriate related party transactions, or other issues related to improper business practices
Vote AGAINST members of the full board or appropriate committee (or only the independent chairman or lead director as may be appropriate in situations such as where there is a classified board and members of the appropriate committee are not up for re-election or the appropriate committee is comprised of the entire board) for the below reasons. New nominees will be considered on a case-by-case basis. Extreme cases may warrant a vote against the entire board.
● |
Material failures of governance, stewardship, or fiduciary responsibilities at the company, including but not limited to violations of the United Nations Global Compact principles and/or other significant global standards and failure to disclose material environmental, social and governance information; |
● |
Egregious actions related to the director(s)’ service on other boards that raise substantial doubt about his or her ability to effectively oversee management and serve the best interests of shareholders at any company; |
● |
The board failed to act on a shareholder proposal that received approval of the majority of shares cast for the previous two consecutive years (a management proposal with other than a FOR recommendation by management will not be considered as sufficient action taken); an adopted proposal that is substantially similar to the original shareholder proposal will be deemed sufficient; (vote against members of the committee of the board that is responsible for the issue under consideration). If we did not support the shareholder proposal in both years, we will still vote against the committee member(s). |
● |
The board failed to act on takeover offers where the majority of the shareholders tendered their shares; |
● |
The company does not disclose various components of current emissions, a proxy for a company’s dependency on fossil fuels and other sources of greenhouse gasses (Scope 1, Scope 2, Scope 3 emissions), material to the company’s business; |
● |
If in an extreme situation the board lacks accountability and oversight, coupled with sustained poor performance relative to peers. |
Discharge of Directors
Generally vote FOR the discharge of directors, including members of the management board and/or supervisory board, unless there is reliable information about significant and compelling controversies that the board is not fulfilling its fiduciary duties warranted by:
● |
A lack of oversight or actions by board members which invoke shareholder distrust related to malfeasance or poor supervision, such as operating in private or company interest rather than in shareholder interest; or |
● |
Any legal issues (e.g., civil/criminal) aiming to hold the board responsible for breach of trust in the past or related to currently alleged actions yet to be confirmed (and not only the fiscal year in question), such as price fixing, insider trading, bribery, fraud, and other illegal actions; or |
● |
Other egregious governance issues where shareholders may bring legal action against the company or its directors; or |
● |
Vote on a CASE-BY-CASE basis where a vote against other agenda items are deemed inappropriate. |
Committee Responsibilities and Expectations
Companies should establish committees to oversee areas such as audit, executive and non-executive compensation, director nominations and ESG oversight. The responsibilities of the committees should be publicly disclosed.
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Audit Committee
Vote AGAINST members of the Audit Committee if:
● |
Non-audit-related fees are substantial, or are in excess of standard annual audit-related fees, or in excess of permitted local limits and guidelines. |
● |
The company receives an adverse opinion on the company’s financial statements from its auditor and there is not clear evidence that the situation has been remedied; |
● |
There is excessive pledging or hedging of stock by executives; |
● |
There is persuasive evidence that the Audit Committee entered into an inappropriate indemnification agreement with its auditor that limits the ability of the company, or its shareholders, to pursue legitimate legal recourse against the audit firm; or |
● |
No members of the Audit Committee hold sufficient financial expertise. |
Vote CASE-BY-CASE on members of the Audit Committee and/or the full board if poor accounting practices, which rise to a level of serious concern are identified, such as fraud, misapplication of accounting principles and material weaknesses identified in audit-related disclosures.
Examine the severity, breadth, chronological sequence and duration, as well as the company’s efforts at remediation or corrective actions, in determining whether negative vote recommendations are warranted against the members of the Audit Committee who are responsible for the poor accounting practices, or the entire board.
Remuneration Committee
See section 3 on Remuneration for reasons to vote against members of the Remuneration Committee.
Nominating/Governance Committee
Vote AGAINST members of the Nominating/Governance Committee if:
● |
At the previous board election, any director received more than 50% withhold/against votes of the shares cast and the company has failed to address the underlying issue(s) that caused the high withhold/against vote; |
● |
The board does not meet our diversity expectations; |
● |
The board amends the company’s bylaws or charter without shareholder approval in a manner that materially diminishes shareholders’ rights or could adversely impact shareholders |
Voting on Director Nomineess in Contested Elections
Vote on a CASE-BY-CASE basis in contested elections of directors, e.g., the election of shareholder nominees or the dismissal of incumbent directors, determining which directors are best suited to add value for shareholders.
The analysis will generally be based on, but not limited to, the following major decision factors:
● |
Company performance relative to its peers; |
● |
Strategy of the incumbents versus the dissidents; |
● |
Independence of board candidates; |
● |
Experience and skills of board candidates; |
● |
Governance profile of the company; |
● |
Evidence of management entrenchment; |
● |
Responsiveness to shareholders; |
● |
Whether a takeover offer has been rebuffed; and |
● |
Whether minority or majority representation is being sought. |
Other Board Related Proposals (Management and Shareholder)
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Vote AGAINST the introduction of classified boards and mandatory retirement ages for directors.
Vote AGAINST proposals to alter board structure or size in the context of a fight for control of the company or the board.
Independent Board Chair (for applicable markets)
We will generally vote AGAINST shareholder proposals requiring that the chairman’s position be filled by an independent director, if the company satisfies 3 of the 4 following criteria:
● |
Two-thirds independent board, or majority in countries where employee representation is common practice; |
● |
A designated, or a rotating, lead director, elected by and from the independent board members with clearly delineated and comprehensive duties; |
● |
Fully independent key committees; and/or |
● |
Established, publicly disclosed, governance guidelines and director biographies/profiles. |
3. |
Remuneration |
Pay Practices
Good pay practices should align management’s interests with long-term shareholder value creation. Detailed disclosure of remuneration criteria is preferred; proof that companies follow the criteria should be evident and retroactive performance target changes without proper disclosure is not viewed favorably. Remuneration practices should allow a company to attract and retain proven talent. Some examples of poor pay practices include: abnormally large bonus payouts without justifiable performance linkage or proper disclosure, egregious employment contracts, excessive severance and/or change in control provisions, repricing or replacing of underwater stock options/stock appreciation rights without prior shareholder approval, and excessive perquisites. A company should also have an appropriate balance of short-term vs. long-term metrics and the metrics should be aligned with business goals and objectives.
If the company maintains problematic or poor pay practices, generally vote:
● |
AGAINST Management Say on Pay (MSOP) Proposals, Remuneration Reports; or |
● |
AGAINST an equity-based incentive plan proposal if excessive non-performance-based equity awards are the major contributor to a pay-for-performance misalignment. |
● |
If no MSOP or equity-based incentive plan proposal item is on the ballot, vote AGAINST from Remuneration Committee members. |
Remuneration Plans
Vote CASE-BY-CASE on management proposals for a vote on executive remuneration, considering the following factors in the context of each company’s specific circumstances and the board’s disclosed rationale for its practices.
Factors considered may include:
● |
Pay for Performance Disconnect; |
– |
We will consider there to be a disconnect based on a quantitative assessment of the following: CEO pay vs. TSR (“Total Shareholder Return”) and peers, CEO pay as a percentage of the median peer group or CEO pay vs. shareholder return over time. |
● |
Long-term equity-based compensation is 100% time-based; |
● |
Board’s responsiveness if company received low shareholder support in the previous year’s MSOP or remuneration vote; |
● |
Abnormally large bonus payouts without justifiable performance linkage or proper disclosure; |
25
● |
Egregious employment contracts; |
● |
Excessive perquisites or excessive severance and/or change in control provisions; |
● |
Repricing or replacing of underwater stock options without prior shareholder approval; |
● |
Egregious pension/SERP (supplemental executive retirement plan) payouts; |
● |
Extraordinary relocation benefits; |
● |
Internal pay disparity; and |
● |
Lack of transparent disclosure of compensation philosophy and goals and targets, including details on short-term and long-term performance incentives. |
Non-Executive Director Compensation
Vote FOR proposals to award cash fees to non-executive directors unless the amounts are excessive relative to other companies in the country or industry.
Vote non-executive director compensation proposals that include both cash and share-based components on a CASE-BY-CASE basis.
Vote proposals that bundle compensation for both non-executive and executive directors into a single resolution on a CASE-BY-CASE basis.
Vote AGAINST proposals to introduce retirement benefits for non-executive directors.
Director, Officer, and Auditor Indemnification and Liability Provisions
Vote proposals seeking indemnification and liability protection for directors and officers on a CASE-BY-CASE basis.
Vote AGAINST proposals to indemnify auditors.
Other Remuneration Related Proposals
Vote on other remuneration related proposals on a CASE-BY-CASE basis.
Remuneration Committee
When voting for members of the Remuneration Committee, factors considered may include:
● |
We voted against the company’s MSOP in the previous year, the company’s previous MSOP received significant opposition of votes cast and we are voting against this year’s MSOP; and |
● |
The board implements a MSOP on a less frequent basis than the frequency that received the plurality of votes cast |
● |
Remuneration structure is widely inconsistent with local market best practices or regulations |
4. |
Shareholder Rights and Defences |
Antitakeover Mechanisms
Generally vote AGAINST all antitakeover proposals, unless they are structured in such a way that they give shareholders the ultimate decision on any proposal or offer.
For the Netherlands, vote recommendations regarding management proposals to approve protective preference shares will be determined on a CASE-BY-CASE basis.
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For French companies listed on a regulated market, generally VOTE AGAINST any general authorities impacting the share capital (i.e. authorities for share repurchase plans and any general share issuances with or without preemptive rights) if they can be used for antitakeover purposes without shareholders’ prior explicit approval.
5. |
Strategic Transactions, Capital Structures and other Business Considerations |
Reorganizations/Restructurings |
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
Mergers and Acquisitions
Vote CASE-BY-CASE on mergers and acquisitions taking into account the following based on publicly available information:
● |
Valuation; |
● |
Market reaction; |
● |
Strategic rationale; |
● |
Management’s track record of successful integration of historical acquisitions; |
● |
Presence of conflicts of interest; and |
● |
Governance profile of the combined company. |
Dual Class Structures
Vote FOR resolutions that seek to maintain or convert to a one-share, one-vote capital structure.
Vote AGAINST requests for the creation or continuation of dual-class capital structures or the creation of new or additional super voting shares.
Share Issuance Requests
General Issuances:
Vote FOR issuance requests with preemptive rights to a maximum of 100% over currently issued capital or any stricter limit set in local best practice recommendations or law.
Vote FOR issuance requests without preemptive rights to a maximum of 20% of currently issued capital or any stricter limit set in local best practice recommendations or law.
Specific Issuances:
Vote on a CASE-BY-CASE basis on all requests, with or without preemptive rights.
Increases in Authorized Capital
Vote FOR non-specific proposals to increase authorized capital up to 100% over the current authorization unless the increase would leave the company with less than 30% of its new authorization outstanding, or any stricter limit set in local best practice recommendations or law.
Vote FOR specific proposals to increase authorized capital to any amount, unless:
● |
The specific purpose of the increase (such as a share-based acquisition or merger) does not meet guidelines for the purpose being proposed; or |
● |
The increase would leave the company with less than 30% of its new authorization outstanding |
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after adjusting for all proposed issuances or any stricter limit set in local best practice recommendations or law.
Vote AGAINST proposals to adopt unlimited capital authorizations.
Reduction of Capital
Vote FOR proposals to reduce capital for routine accounting purposes unless the terms are unfavorable to shareholders.
Vote proposals to reduce capital in connection with corporate restructuring on a CASE-BY-CASE basis.
Preferred Stock
Vote FOR the creation of a new class of preferred stock or for issuances of preferred stock up to 50% of issued capital unless the terms of the preferred stock would adversely affect the rights of existing shareholders.
Vote FOR the creation/issuance of convertible preferred stock as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote AGAINST the creation of a new class of preference shares that would carry superior voting rights to the common shares.
Vote AGAINST the creation of blank check preferred stock unless the board clearly states that the authorization will not be used to thwart a takeover bid.
Vote proposals to increase blank check preferred authorizations on a CASE-BY-CASE basis.
Debt Issuance Requests
Vote non-convertible debt issuance requests on a CASE-BY-CASE basis, with or without preemptive rights.
Vote FOR the creation/issuance of convertible debt instruments as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote FOR proposals to restructure existing debt arrangements unless the terms of the restructuring would adversely affect the rights of shareholders.
Increase in Borrowing Powers
Vote proposals to approve increases in a company’s borrowing powers on a CASE-BY-CASE basis.
Share Repurchase Plans
We will generally recommend FOR share repurchase programs taking into account whether:
● |
The share repurchase program can be used as a takeover defense; |
● |
There is clear evidence of historical abuse; |
● |
There is no safeguard in the share repurchase program against selective buybacks; |
● |
Pricing provisions and safeguards in the share repurchase program are deemed to be unreasonable in light of market practice. |
Reissuance of Repurchased Shares
Vote FOR requests to reissue any repurchased shares unless there is clear evidence of abuse of this authority in the past.
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Capitalization of Reserves for Bonus Issues/Increase in Par Value
Vote FOR requests to capitalize reserves for bonus issues of shares or to increase par value.
Reorganizations/Restructurings
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
Reincorporation Proposals
Vote reincorporation proposals on a CASE-BY-CASE basis.
Related-Party Transactions
Vote related-party transactions on a CASE-BY-CASE basis, considering factors including, but not limited to, the following:
● |
The parties on either side of the transaction; |
● |
The nature of the asset to be transferred/service to be provided; |
● |
The pricing of the transaction (and any associated professional valuation); |
● |
The views of independent directors (where provided); |
● |
The views of an independent financial adviser (where appointed); |
● |
Whether any entities party to the transaction (including advisers) is conflicted; and |
● |
The stated rationale for the transaction, including discussions of timing |
6. |
Environmental and Social Issues |
Overall Approach
Proposals considered under this category could include, among others, reports on:
1) |
employee labor and safety policies; |
2) |
impact on the environment of the company’s production or manufacturing operations; |
3) |
societal impact of products manufactured; |
4) |
risks throughout the supply chain or operations including labor practices, animal treatment practices within food production and conflict minerals; and |
5) |
overall board structure, including diversity. |
When evaluating environmental and social shareholder proposals, the following factors are generally considered:
● |
The company’s current level of publicly available disclosure, including if the company already discloses similar information through existing reports or policies; |
● |
If the company has implemented or formally committed to the implementation of a reporting program based on the Sustainability Accounting Standards Board’s (SASB) materiality standards, the Task Force on Climate-related Financial Disclosure’s (TCFD) recommendations, or a similar standard; |
● |
Whether adoption of the proposal is likely to enhance or protect shareholder value; |
● |
Whether the information requested concerns business issues that relate to a meaningful percentage of the company’s business; |
● |
The degree to which the company’s stated position on the issues raised in the proposal could affect its reputation or sales, or leave it vulnerable to a boycott or selective purchasing; |
● |
Whether the company has already responded in some appropriate manner to the request embodied in the proposal; |
● |
What other companies in the relevant industry have done in response to the issue addressed in the proposal; |
● |
Whether the proposal itself is well framed and the cost of preparing the report is reasonable; |
29
● |
Whether the subject of the proposal is best left to the discretion of the board; |
● |
Whether the company has material fines or violations in the area and if so, if appropriate actions have already been taken to remedy going forward; |
● |
Whether providing this information would reveal proprietary or confidential information that would place the company at a competitive disadvantage. |
Environmental Issues
Climate Transition Plans
Generally vote CASE-BY-CASE on management proposed climate transition plans. When evaluating management proposed plans, the following factors are generally considered:
● |
If the company has detailed disclosure of the governance, strategy, risk mitigation efforts, and metrics and targets based on the TCFD’s recommendations, or a similar standard; |
● |
If the company has detailed disclosure of their current emissions data based on the SASB materiality framework; and |
● |
If the company has detailed disclosure in line with Paris Agreement goals. |
Generally vote CASE-BY-CASE on shareholder proposals requesting climate transition plans. When evaluating these shareholder proposals, the following factors are generally considered:
● |
The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
● |
If the proposal asks for detailed disclosure according to the TCFD’s recommendations; |
● |
If the proposal asks for detailed disclosure of the company’s current emissions data based on the SASB materiality framework; |
● |
If the proposal asks for long-term targets, as well as short and medium term milestones; |
● |
If the proposal asks for targets to be aligned to a globally accepted framework, such as Paris Aligned or Net Zero; |
● |
If the proposal asks for targets to be approved by the Science Based Target Initiative (“SBTi”); |
● |
If the proposal seeks to add reasonable transparency and is not onerous or overly prescriptive; and |
● |
Whether the proposal is binding or non-binding. |
Environmental Sustainability Reporting
Generally vote FOR shareholders proposals requesting the company to report on its policies, initiatives and oversight mechanisms related to environmental sustainability, including the impacts of climate change and biodiversity loss. The following factors will be considered:
● |
The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
● |
If the company has formally committed to the implementation of a reporting program based on the SASB materiality standards, the TCFD’s recommendations, or a similar standard within a specified time frame; |
● |
If the company’s current level of disclosure is comparable to that of its industry peers; and |
● |
If there are significant controversies, fines, penalties, or litigation associated with the company’s environmental performance. |
Other Environmental Proposals
Vote CASE-BY-CASE on the following shareholder proposals if relevant to the company:
30
● |
Seeking information on the financial, physical, or regulatory risks a company faces related to climate change on its operations and investment, or on how the company identifies, measures and manages such risks; |
● |
Calling for the reduction of Greenhouse Gas (GHG) emissions; |
● |
Seeking reports on responses to regulatory and public pressures surrounding climate change, and for disclosure of research that aided in setting company policies around climate change; |
● |
Requesting an action plan including science based targets and a commitment to net zero emissions by 2050 or earlier; |
● |
Requesting a report/disclosure of goals on GHG emissions from company operations and/or products; |
● |
Requesting a company report on its energy efficiency policies; and |
● |
Requesting reports on the feasibility of developing renewable energy resources. |
Social Issues
Board and Workforce Demographics
A company should have a clear, public Equal Employment Opportunity (EEO) statement and/or diversity policy. Generally vote FOR proposals seeking to amend a company’s EEO statement or diversity policies to additionally prohibit discrimination based on sexual orientation and/or gender identity.
Generally vote FOR proposals requesting reports on a company’s efforts to diversify the board, unless:
● |
The gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business; and |
● |
The board already reports on its nominating procedures and gender and racial minority initiatives on the board. |
Gender Pay Gap
Generally vote CASE-BY-CASE on proposals requesting reports on a company’s pay data by gender, or a report on a company’s policies and goals to reduce any gender pay gap, taking into account:
● |
The company’s current policies and disclosure related to both its diversity and inclusion policies and practices and its compensation philosophy and fair and equitable compensation practices; |
● |
Whether the company has been the subject of recent controversy, litigation or regulatory actions related to gender pay gap issues; and |
● |
Whether the company’s reporting regarding gender pay gap policies or initiatives is lagging its peers. |
Labor, Human and Animal Rights Standards
Generally vote FOR proposals requesting a report on company or company supplier labor, human, and/or animal rights standards and policies, or on the impact of its operations on society, unless such information is already publicly disclosed considering:
● |
The degree to which existing relevant policies and practices are disclosed; |
● |
Whether or not existing relevant policies are consistent with internationally recognized standards; |
● |
Whether company facilities and those of its suppliers are monitored and how; |
● |
Company participation in fair labor organizations or other internationally recognized human rights initiatives; |
● |
Scope and nature of business conducted in markets known to have higher risk of workplace labor/human rights abuse; |
● |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; |
● |
The scope of the request; and |
● |
Deviation from industry sector peer company standards and practices. |
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Generally vote CASE-BY-CASE on shareholder proposals requesting reports about a company’s use of mandatory arbitrations in employment claims, taking into account the company’s existing policies and disclosures of policies.
Generally vote CASE-BY-CASE on shareholder proposals requesting reports on the actions taken by a company to prevent sexual and other forms of harassment or on the risks posed by the company’s failure to take such actions, taking into account the company’s existing policies and disclosures of policies.
Racial Equity Audit
• |
Generally vote CASE-BY-CASE on shareholder proposals requesting the board oversee a racial equity audit. While we believe the decision to initiate an independent audit is best left to management judgment under the oversight of the board of directors, the following factors are generally considered: |
• |
The degree to which existing relevant policies and practices are disclosed; |
• |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; and |
• |
Whether the gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business. |
Political Contributions and Trade Association Spending/Lobbying Expenditures and Initiatives
We generally believe that it is the role of boards and management to determine the appropriate level of disclosure of all types of corporate political activity. When evaluating these proposals, we consider the prescriptive nature of the proposal and the overall benefit to shareholders along with a company’s current disclosure of policies, practices and oversight.
Generally vote AGAINST proposals asking the company to affirm political nonpartisanship in the workplace so long as:
● |
There are no recent, significant controversies, fines or litigation regarding the company’s political contributions or trade association spending; and |
● |
The company has procedures in place to ensure that employee contributions to company-sponsored political action committees (PACs) are strictly voluntary and prohibits coercion. |
Generally vote AGAINST proposals requesting increased disclosure of a company’s policies with respect to political contributions, lobbying and trade association spending as long as:
● |
There is no significant potential threat or actual harm to shareholders’ interests; |
● |
There are no recent significant controversies or litigation related to the company’s political contributions or governmental affairs; and |
● |
There is publicly available information to assess the company’s oversight related to such expenditures of corporate assets. |
We generally will vote AGAINST proposals asking for detailed disclosure of political contributions or trade association or lobbying expenditures.
We generally will vote AGAINST proposals barring the company from making political contributions. Businesses are affected by legislation at the federal, state, and local level and barring political contributions can put the company at a competitive disadvantage.
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Region: Asia Pacific (APAC) Proxy Items
The following section is a broad summary of the Guidelines, which form the basis of the Policy with respect to APAC public equity investments of operating and/or holding companies. Applying these guidelines is subject to certain regional and country-specific exceptions and modifications and is not inclusive of all considerations in each market. For Japan-specific policies, see Japan Proxy Items from page X.
1. |
Business Items |
Financial Results/Director and Auditor Reports
Vote FOR approval of financial statements and director and auditor reports, unless:
● |
There are serious concerns about the accounts presented, audit procedures used or audit opinion rendered; or |
● |
The company is not responsive to shareholder questions about specific items that should be publicly disclosed. |
Appointment of Auditors and Auditor Fees
Vote FOR the re-election of auditors and proposals authorizing the board to fix auditor fees unless:
● |
There are serious concerns about the accounts presented, audit procedures used or audit opinion rendered; |
● |
There is reason to believe that the auditor has rendered an opinion that is neither accurate nor indicative of the company’s financial position; |
● |
Name of the proposed auditor has not been published; |
● |
The auditors are being changed without explanation; |
● |
Non-audit-related fees are substantial, or are in excess of standard annual audit-related fees, or in excess of permitted local limits and guidelines; or |
● |
The appointment of external auditors if they have previously served the company in an executive capacity or can otherwise be considered affiliated with the company. |
Appointment of Internal Statutory Auditors
Vote FOR the appointment or re-election of statutory auditors, unless:
● |
There are serious concerns about the statutory reports presented or the audit procedures used; |
● |
Questions exist concerning any of the statutory auditors being appointed; or |
● |
The auditors have previously served the company in an executive capacity or can otherwise be considered affiliated with the company. |
Reincorporation Proposals
Vote reincorporation proposals on a CASE-BY-CASE basis.
Allocation of Income
Vote FOR approval of the allocation of income, unless:
● |
The dividend payout ratio has been consistently low without adequate explanation; or |
● |
The payout is excessive given the company’s financial position. |
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Stock (Scrip) Dividend Alternative
Vote FOR most stock (scrip) dividend proposals.
Vote AGAINST proposals that do not allow for a cash option unless management demonstrates that the cash option is harmful to shareholder value.
Amendments to Articles of Association
Vote amendments to the articles of association on a CASE-BY-CASE basis.
Change in Company Fiscal Term
Vote FOR resolutions to change a company’s fiscal term unless a company’s motivation for the change is to postpone its annual general meeting.
Lower Disclosure Threshold for Stock Ownership
Vote AGAINST resolutions to lower the stock ownership disclosure threshold below 5% unless specific reasons exist to implement a lower threshold.
Amend Quorum Requirements
Vote proposals to amend quorum requirements for shareholder meetings on a CASE-BY-CASE basis.
Virtual Meetings
Generally vote FOR proposals allowing for the convening of hybrid* shareholder meetings if it is clear that it is not the intention to hold virtual-only AGMs. Generally vote AGAINST proposals allowing for the convening of virtual-only* shareholder meetings.
* The phrase “virtual-only shareholder meeting” refers to a meeting of shareholders that is held exclusively through the use of online technology without a corresponding in-person meeting. The term “hybrid shareholder meeting” refers to an in-person, or physical, meeting in which shareholders are permitted to participate online.
Transact Other Business
Vote AGAINST other business when it appears as a voting item.
Administrative Requests
Generally vote FOR non-contentious administrative management requests.
2. |
Board of Directors |
The board of directors should promote the interests of shareholders by acting in an oversight and/or advisory role; should consist of a majority of independent directors and / or meet local best practice expectations; and should be held accountable for actions and results related to their responsibilities.
Voting on Director Nominees in Uncontested Elections
Vote on director nominees should be determined on a CASE-BY-CASE basis taking into consideration the following:
● |
Adequate disclosure has not been provided in a timely manner; or |
34
● |
There are clear concerns over questionable finances or restatements; or |
● |
There have been questionable transactions or conflicts of interest; or |
● |
There are any records of abuses against minority shareholder interests; or |
● |
The board fails to meet minimum corporate governance standards; or |
● |
There are reservations about: |
o |
Director terms |
o |
Bundling of proposals to elect directors |
o |
Board independence |
o |
Disclosure of named nominees |
o |
Combined Chairman/CEO |
o |
Election of former CEO as Chairman of the board |
o |
Overboarded directors |
o |
Composition of committees |
o |
Director independence |
o |
Number of directors on the board |
o |
Lack of gender diversity on the board |
● |
Specific concerns about the individual or company, such as criminal wrongdoing or breach of fiduciary responsibilities; or |
● |
There are other considerations which may include sanction from government or authority, violations of laws and regulations, or other issues relate to improper business practice, failure to replace management, or egregious actions related to service on other boards. |
Board Composition
We generally believe diverse teams have the potential to outperform and we expect the companies that we invest in to focus on the importance of diversity. When evaluating board composition, we believe a diversity of ethnicity, gender and experience is an important consideration. We encourage companies to disclose the composition of their board in the proxy statement and may vote against members of the board without disclosure. See below how we execute our vote at companies that do not meet our diversity expectations.
Vote AGAINST members of the Nominating Committee:
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At companies if the board does not have at least 10% women directors, or does not meet the requirements of local listing rules or corporate governance codes or national targets; |
Employee and /or Labor Representatives
Vote FOR employee and/or labor representatives if they sit on either the audit or compensation committee and are required by law to be on those committees.
Vote AGAINST employee and/or labor representatives if they sit on either the audit or compensation committee, if they are not required to be on those committees.
Director Independence
Classification of Directors
Executive Director
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Employee or executive of the company; |
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Any director who is classified as a non-executive, but receives salary, fees, bonus, and/or other benefits that are in line with the highest-paid executives of the company. |
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Non-Independent Non-Executive Director (NED)
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Any director who is attested by the board to be a non-independent NED; |
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Any director specifically designated as a representative of a significant shareholder of the company; |
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Any director who is also an employee or executive of a significant shareholder of the company; |
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Beneficial owner (direct or indirect) of at least 10% of the company’s stock, either in economic terms or in voting rights (this may be aggregated if voting power is distributed among more than one member of a defined group, e.g., family members who beneficially own less than 10% individually, but collectively own more than 10%), unless market best practice dictates a lower ownership and/or disclosure threshold (and in other special market-specific circumstances); |
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Government representative; |
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Currently provides (or a relative provides) professional services to the company, to an affiliate of the company, or to an individual officer of the company or of one of its affiliates in excess of $10,000 per year; |
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Represents customer, supplier, creditor, banker, or other entity with which company maintains transactional/commercial relationship (unless company discloses information to apply a materiality test); |
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Any director who has conflicting or cross-directorships with executive directors or the chairman of the company; |
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Relative of a current employee of the company or its affiliates; |
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Relative of a former executive of the company or its affiliates; |
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A new appointee elected other than by a formal process through the General Meeting (such as a contractual appointment by a substantial shareholder); |
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Founder/co-founder/member of founding family but not currently an employee; |
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Former executive (a cooling off period may be applied); |
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Years of service is generally not a determining factor unless it is recommended best practice in a market and/or in extreme circumstances, in which case it may be considered; and |
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Any additional relationship or principle considered to compromise independence under local corporate governance best practice guidance. |
Independent NED
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No material connection, either directly or indirectly, to the company other than a board seat. |
Employee Representative
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Represents employees or employee shareholders of the company (classified as “employee representative” but considered a non-independent NED). |
Director Accountability
Vote AGAINST individual directors who attend less than 75% of the board and committee meetings without a disclosed valid excuse.
Generally, vote FOR the bundled election of management nominees, unless adequate disclosures of the nominees have not been provided in a timely manner or if one or more of the nominees does not meet the expectation of our policy.
Other items considered for an AGAINST vote include specific concerns about the individual or the company, such as criminal wrongdoing or breach of fiduciary responsibilities, sanctions from government or authority, violations of laws and regulations, the presence of inappropriate related party transactions, or other issues related to improper business practices
Vote AGAINST members of the full board or appropriate committee (or only the independent chairman or lead director as may be appropriate in situations such as where there is a classified board and members of the appropriate committee are not up for re-election or the appropriate committee is comprised of the entire board) for the below
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reasons. New nominees will be considered on a case-by-case basis. Extreme cases may warrant a vote against the entire board.
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Material failures of governance, stewardship, or fiduciary responsibilities at the company, including but not limited to violations of the United Nations Global Compact principles and/or other significant global standards and failure to disclose material environmental, social and governance information; |
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Egregious actions related to the director(s)’ service on other boards that raise substantial doubt about his or her ability to effectively oversee management and serve the best interests of shareholders at any company; |
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The board failed to act on a shareholder proposal that received approval of the majority of shares cast for the previous two consecutive years (a management proposal with other than a FOR recommendation by management will not be considered as sufficient action taken); an adopted proposal that is substantially similar to the original shareholder proposal will be deemed sufficient; (vote against members of the committee of the board that is responsible for the issue under consideration). If we did not support the shareholder proposal in both years, we will still vote against the committee member(s). |
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The board failed to act on takeover offers where the majority of the shareholders tendered their shares; |
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The company does not disclose various components of current emissions, a proxy for a company’s dependency on fossil fuels and other sources of greenhouse gasses (Scope 1, Scope 2, Scope 3 emissions), material to the company’s business; |
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If in an extreme situation the board lacks accountability and oversight, coupled with sustained poor performance relative to peers. |
Discharge of Directors
Generally vote FOR the discharge of directors, including members of the management board and/or supervisory board, unless there is reliable information about significant and compelling controversies that the board is not fulfilling its fiduciary duties warranted by:
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A lack of oversight or actions by board members which invoke shareholder distrust related to malfeasance or poor supervision, such as operating in private or company interest rather than in shareholder interest; or |
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Any legal issues (e.g., civil/criminal) aiming to hold the board responsible for breach of trust in the past or related to currently alleged actions yet to be confirmed (and not only the fiscal year in question), such as price fixing, insider trading, bribery, fraud, and other illegal actions; or |
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Other egregious governance issues where shareholders may bring legal action against the company or its directors; or |
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Vote on a CASE-BY-CASE basis where a vote against other agenda items are deemed inappropriate. |
Committee Responsibilities and Expectations
Companies should establish committees to oversee areas such as audit, executive and non-executive compensation, director nominations and ESG oversight. The responsibilities of the committees should be publicly disclosed.
Audit Committee
Vote AGAINST members of the Audit Committee if:
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Non-audit-related fees are substantial, or are in excess of standard annual audit-related fees, or in excess of permitted local limits and guidelines. |
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The company receives an adverse opinion on the company’s financial statements from its auditor and there is not clear evidence that the situation has been remedied; |
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There is excessive pledging or hedging of stock by executives; |
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There is persuasive evidence that the Audit Committee entered into an inappropriate indemnification agreement with its auditor that limits the ability of the company, or its shareholders, to pursue legitimate legal recourse against the audit firm; or |
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No members of the Audit Committee hold sufficient financial expertise. |
Vote CASE-BY-CASE on members of the Audit Committee and/or the full board if poor accounting practices, which rise to a level of serious concern are identified, such as fraud, misapplication of accounting principles and material weaknesses identified in audit-related disclosures.
Examine the severity, breadth, chronological sequence and duration, as well as the company’s efforts at remediation or corrective actions, in determining whether negative vote recommendations are warranted against the members of the Audit Committee who are responsible for the poor accounting practices, or the entire board.
Remuneration Committee
See section 3 on Remuneration for reasons to vote against members of the Remuneration Committee.
Nominating/Governance Committee
Vote AGAINST members of the Nominating/Governance Committee if:
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At the previous board election, any director received more than 50% withhold/against votes of the shares cast and the company has failed to address the underlying issue(s) that caused the high withhold/against vote; |
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The board does not meet our diversity expectations; |
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The board amends the company’s bylaws or charter without shareholder approval in a manner that materially diminishes shareholders’ rights or could adversely impact shareholders |
Voting on Director Nominees in Contested Elections
Vote on a CASE-BY-CASE basis in contested elections of directors, e.g., the election of shareholder nominees or the dismissal of incumbent directors, determining which directors are best suited to add value for shareholders.
The analysis will generally be based on, but not limited to, the following major decision factors:
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Company performance relative to its peers; |
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Strategy of the incumbents versus the dissidents; |
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Independence of board candidates; |
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Experience and skills of board candidates; |
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Governance profile of the company; |
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Evidence of management entrenchment; |
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Responsiveness to shareholders; |
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Whether a takeover offer has been rebuffed; and |
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Whether minority or majority representation is being sought. |
Other Board Related Proposals (Management and Shareholder)
Vote AGAINST the introduction of classified boards and mandatory retirement ages for directors.
Vote AGAINST proposals to alter board structure or size in the context of a fight for control of the company or the board.
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Independent Board Chair (for applicable markets)
We will generally vote AGAINST shareholder proposals requiring that the chairman’s position be filled by an independent director, if the company satisfies 3 of the 4 following criteria:
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Two-thirds independent board, or majority in countries where employee representation is common practice; |
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A designated, or a rotating, lead director, elected by and from the independent board members with clearly delineated and comprehensive duties; |
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Fully independent key committees; and/or |
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Established, publicly disclosed, governance guidelines and director biographies/profiles. |
3. |
Remuneration |
Pay Practices
Good pay practices should align management’s interests with long-term shareholder value creation. Detailed disclosure of remuneration criteria is preferred; proof that companies follow the criteria should be evident and retroactive performance target changes without proper disclosure is not viewed favorably. Remuneration practices should allow a company to attract and retain proven talent. Some examples of poor pay practices include: abnormally large bonus payouts without justifiable performance linkage or proper disclosure, egregious employment contracts, excessive severance and/or change in control provisions, repricing or replacing of underwater stock options/stock appreciation rights without prior shareholder approval, and excessive perquisites. A company should also have an appropriate balance of short-term vs. long-term metrics and the metrics should be aligned with business goals and objectives.
If the company maintains problematic or poor pay practices, generally vote:
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AGAINST Management Say on Pay (MSOP) Proposals, Remuneration Reports; or |
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AGAINST an equity-based incentive plan proposal if excessive non-performance-based equity awards are the major contributor to a pay-for-performance misalignment. |
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If no MSOP or equity-based incentive plan proposal item is on the ballot, vote AGAINST from Remuneration Committee members. |
Remuneration Plans
Vote CASE-BY-CASE on management proposals for a vote on executive remuneration, considering the following factors in the context of each company’s specific circumstances and the board’s disclosed rationale for its practices.
Factors considered may include:
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Pay for Performance Disconnect; |
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We will consider there to be a disconnect based on a quantitative assessment of the following: CEO pay vs. TSR (“Total Shareholder Return”) and peers, CEO pay as a percentage of the median peer group or CEO pay vs. shareholder return over time. |
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Long-term equity-based compensation is 100% time-based; |
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Board’s responsiveness if company received low shareholder support in the previous year’s MSOP or remuneration vote; |
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Abnormally large bonus payouts without justifiable performance linkage or proper disclosure; |
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Egregious employment contracts; |
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Excessive perquisites or excessive severance and/or change in control provisions; |
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Repricing or replacing of underwater stock options without prior shareholder approval; |
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Egregious pension/SERP (supplemental executive retirement plan) payouts; |
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Extraordinary relocation benefits; |
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Internal pay disparity; and |
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Lack of transparent disclosure of compensation philosophy and goals and targets, including details on short-term and long-term performance incentives. |
Non-Executive Director Compensation
Vote FOR proposals to award cash fees to non-executive directors unless the amounts are excessive relative to other companies in the country or industry.
Vote non-executive director compensation proposals that include both cash and share-based components on a CASE-BY-CASE basis.
Vote proposals that bundle compensation for both non-executive and executive directors into a single resolution on a CASE-BY-CASE basis.
Vote AGAINST proposals to introduce retirement benefits for non-executive directors.
Director, Officer, and Auditor Indemnification and Liability Provisions
Vote proposals seeking indemnification and liability protection for directors and officers on a CASE-BY-CASE basis.
Vote AGAINST proposals to indemnify auditors.
Other Remuneration Related Proposals
Vote on other remuneration related proposals on a CASE-BY-CASE basis.
Remuneration Committee
When voting for members of the Remuneration Committee, factors considered may include:
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We voted against the company’s MSOP in the previous year, the company’s previous MSOP received significant opposition of votes cast and we are voting against this year’s MSOP; and |
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The board implements a MSOP on a less frequent basis than the frequency that received the plurality of votes cast |
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Remuneration structure is widely inconsistent with local market best practices or regulations |
4. |
Shareholder Rights and Defences |
Antitakeover Mechanisms
Generally vote AGAINST all antitakeover proposals, unless they are structured in such a way that they give shareholders the ultimate decision on any proposal or offer.
5. |
Strategic Transactions, Capital Structures and other Business Considerations |
Reorganizations/Restructurings
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
Mergers and Acquisitions
Vote CASE-BY-CASE on mergers and acquisitions taking into account the following based on publicly available information:
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Valuation; |
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Market reaction; |
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Strategic rationale; |
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Management’s track record of successful integration of historical acquisitions; |
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Presence of conflicts of interest; and |
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Governance profile of the combined company. |
Dual Class Structures
Vote FOR resolutions that seek to maintain or convert to a one-share, one-vote capital structure.
Vote AGAINST requests for the creation or continuation of dual-class capital structures or the creation of new or additional super voting shares.
Share Issuance Requests
General Issuances:
Vote FOR issuance requests with preemptive rights to a maximum of 100% over currently issued capital or any stricter limit set in local best practice recommendations or law.
Vote FOR issuance requests without preemptive rights to a maximum of 20% of currently issued capital or any stricter limit set in local best practice recommendations or law. At companies in India, vote FOR issuance requests without preemptive rights to a maximum of 25% of currently issued capital.
Specific Issuances:
Vote on a CASE-BY-CASE basis on all requests, with or without preemptive rights.
Increases in Authorized Capital
Vote FOR non-specific proposals to increase authorized capital up to 100% over the current authorization unless the increase would leave the company with less than 30% of its new authorization outstanding, or any stricter limit set in local best practice recommendations or law.
Vote FOR specific proposals to increase authorized capital to any amount, unless:
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The specific purpose of the increase (such as a share-based acquisition or merger) does not meet guidelines for the purpose being proposed; or |
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The increase would leave the company with less than 30% of its new authorization outstanding after adjusting for all proposed issuances, or any stricter limit set in local best practice recommendations or law |
Vote AGAINST proposals to adopt unlimited capital authorizations.
Reduction of Capital
Vote FOR proposals to reduce capital for routine accounting purposes unless the terms are unfavorable to shareholders.
Vote proposals to reduce capital in connection with corporate restructuring on a CASE-BY-CASE basis.
Preferred Stock
Vote FOR the creation of a new class of preferred stock or for issuances of preferred stock up to 50% of issued capital unless the terms of the preferred stock would adversely affect the rights of existing shareholders.
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Vote FOR the creation/issuance of convertible preferred stock as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote AGAINST the creation of a new class of preference shares that would carry superior voting rights to the common shares.
Vote AGAINST the creation of blank check preferred stock unless the board clearly states that the authorization will not be used to thwart a takeover bid.
Vote proposals to increase blank check preferred authorizations on a CASE-BY-CASE basis.
Debt Issuance Requests
Vote non-convertible debt issuance requests on a CASE-BY-CASE basis, with or without preemptive rights.
Vote FOR the creation/issuance of convertible debt instruments as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote FOR proposals to restructure existing debt arrangements unless the terms of the restructuring would adversely affect the rights of shareholders.
Increase in Borrowing Powers
Vote proposals to approve increases in a company’s borrowing powers on a CASE-BY-CASE basis.
Share Repurchase Plans
We will generally recommend FOR share repurchase programs taking into account whether:
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The share repurchase program can be used as a takeover defense; |
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There is clear evidence of historical abuse; |
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There is no safeguard in the share repurchase program against selective buybacks; |
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Pricing provisions and safeguards in the share repurchase program are deemed to be unreasonable in light of market practice. |
Reissuance of Repurchased Shares
Vote FOR requests to reissue any repurchased shares unless there is clear evidence of abuse of this authority in the past.
Capitalization of Reserves for Bonus Issues/Increase in Par Value
Vote FOR requests to capitalize reserves for bonus issues of shares or to increase par value.
Reorganizations/Restructurings
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
Reincorporation Proposals
Vote reincorporation proposals on a CASE-BY-CASE basis.
Related-Party Transactions
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Vote related-party transactions on a CASE-BY-CASE basis, considering factors including, but not limited to, the following:
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The parties on either side of the transaction; |
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The nature of the asset to be transferred/service to be provided; |
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The pricing of the transaction (and any associated professional valuation); |
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The views of independent directors (where provided); |
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The views of an independent financial adviser (where appointed); |
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Whether any entities party to the transaction (including advisers) is conflicted; and The stated rationale for the transaction, including discussions of timing |
6. |
Environmental and Social Issues |
Overall Approach
Proposals considered under this category could include, among others, reports on:
1) |
employee labor and safety policies; |
2) |
impact on the environment of the company’s production or manufacturing operations; |
3) |
societal impact of products manufactured; |
4) |
risks throughout the supply chain or operations including labor practices, animal treatment practices within food production and conflict minerals; and |
5) |
overall board structure, including diversity. |
When evaluating environmental and social shareholder proposals, the following factors are generally considered:
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The company’s current level of publicly available disclosure, including if the company already discloses similar information through existing reports or policies; |
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If the company has implemented or formally committed to the implementation of a reporting program based on the Sustainability Accounting Standards Board’s (SASB) materiality standards, the Task Force on Climate-related Financial Disclosure’s (TCFD) recommendations, or a similar standard; |
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Whether adoption of the proposal is likely to enhance or protect shareholder value; |
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Whether the information requested concerns business issues that relate to a meaningful percentage of the company’s business; |
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The degree to which the company’s stated position on the issues raised in the proposal could affect its reputation or sales, or leave it vulnerable to a boycott or selective purchasing; |
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Whether the company has already responded in some appropriate manner to the request embodied in the proposal; |
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What other companies in the relevant industry have done in response to the issue addressed in the proposal; |
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Whether the proposal itself is well framed and the cost of preparing the report is reasonable; |
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Whether the subject of the proposal is best left to the discretion of the board; |
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Whether the company has material fines or violations in the area and if so, if appropriate actions have already been taken to remedy going forward; |
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Whether providing this information would reveal proprietary or confidential information that would place the company at a competitive disadvantage. |
Environmental Issues
Climate Transition Plans
Generally vote CASE-BY-CASE on management proposed climate transition plans. When evaluating management proposed plans, the following factors are generally considered:
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If the company has detailed disclosure of the governance, strategy, risk mitigation efforts, and metrics and targets based on the TCFD’s recommendations, or a similar standard; |
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If the company has detailed disclosure of their current emissions data based on the SASB materiality framework; and |
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If the company has detailed disclosure in line with Paris Agreement goals. |
Generally vote CASE-BY-CASE on shareholder proposals requesting climate transition plans. When evaluating these shareholder proposals, the following factors are generally considered:
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The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
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If the proposal asks for detailed disclosure according to the TCFD’s recommendations; |
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If the proposal asks for detailed disclosure of the company’s current emissions data based on the SASB materiality framework; |
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If the proposal asks for long-term targets, as well as short and medium term milestones; |
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If the proposal asks for targets to be aligned to a globally accepted framework, such as Paris Aligned or Net Zero; |
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If the proposal asks for targets to be approved by the Science Based Target Initiative (“SBTi”); |
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If the proposal seeks to add reasonable transparency and is not onerous or overly prescriptive; and |
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Whether the proposal is binding or non-binding. |
Environmental Sustainability Reporting
Generally vote FOR shareholders proposals requesting the company to report on its policies, initiatives and oversight mechanisms related to environmental sustainability, including the impacts of climate change and biodiversity loss. The following factors will be considered:
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The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
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If the company has formally committed to the implementation of a reporting program based on the SASB materiality standards, the TCFD’s recommendations, or a similar standard within a specified time frame; |
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If the company’s current level of disclosure is comparable to that of its industry peers; and |
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If there are significant controversies, fines, penalties, or litigation associated with the company’s environmental performance. |
Other Environmental Proposals
Vote CASE-BY-CASE on the following shareholder proposals if relevant to the company:
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Seeking information on the financial, physical, or regulatory risks a company faces related to climate change on its operations and investment, or on how the company identifies, measures and manages such risks; |
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Calling for the reduction of Greenhouse Gas (GHG) emissions; |
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Seeking reports on responses to regulatory and public pressures surrounding climate change, and for disclosure of research that aided in setting company policies around climate change; |
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Requesting an action plan including science based targets and a commitment to net zero emissions by 2050 or earlier; |
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Requesting a report/disclosure of goals on GHG emissions from company operations and/or products; |
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Requesting a company report on its energy efficiency policies; and |
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Requesting reports on the feasibility of developing renewable energy resources. |
Social Issues
Board and Workforce Demographics
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A company should have a clear, public Equal Employment Opportunity (EEO) statement and/or diversity policy. Generally vote FOR proposals seeking to amend a company’s EEO statement or diversity policies to additionally prohibit discrimination based on sexual orientation and/or gender identity.
Generally vote FOR proposals requesting reports on a company’s efforts to diversify the board, unless:
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The gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business; and |
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The board already reports on its nominating procedures and gender and racial minority initiatives on the board. |
Gender Pay Gap
Generally vote CASE-BY-CASE on proposals requesting reports on a company’s pay data by gender, or a report on a company’s policies and goals to reduce any gender pay gap, taking into account:
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The company’s current policies and disclosure related to both its diversity and inclusion policies and practices and its compensation philosophy and fair and equitable compensation practices; |
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Whether the company has been the subject of recent controversy, litigation or regulatory actions related to gender pay gap issues; and |
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Whether the company’s reporting regarding gender pay gap policies or initiatives is lagging its peers. |
Labor, Human and Animal Rights Standards
Generally vote FOR proposals requesting a report on company or company supplier labor, human, and/or animal rights standards and policies, or on the impact of its operations on society, unless such information is already publicly disclosed considering:
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The degree to which existing relevant policies and practices are disclosed; |
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Whether or not existing relevant policies are consistent with internationally recognized standards; |
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Whether company facilities and those of its suppliers are monitored and how; |
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Company participation in fair labor organizations or other internationally recognized human rights initiatives; |
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Scope and nature of business conducted in markets known to have higher risk of workplace labor/human rights abuse; |
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Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; |
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The scope of the request; and |
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Deviation from industry sector peer company standards and practices. |
Generally vote CASE-BY-CASE on shareholder proposals requesting reports about a company’s use of mandatory arbitrations in employment claims, taking into account the company’s existing policies and disclosures of policies.
Generally vote CASE-BY-CASE on shareholder proposals requesting reports on the actions taken by a company to prevent sexual and other forms of harassment or on the risks posed by the company’s failure to take such actions, taking into account the company’s existing policies and disclosures of policies.
Racial Equity Audit
• |
Generally vote CASE-BY-CASE on shareholder proposals requesting the board oversee a racial equity audit. While we believe the decision to initiate an independent audit is best left to management judgment under the oversight of the board of directors, the following factors are generally considered: |
• |
The degree to which existing relevant policies and practices are disclosed; |
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• |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; and |
• |
Whether the gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business. |
Political Contributions and Trade Association Spending/Lobbying Expenditures and Initiatives
We generally believe that it is the role of boards and management to determine the appropriate level of disclosure of all types of corporate political activity. When evaluating these proposals, we consider the prescriptive nature of the proposal and the overall benefit to shareholders along with a company’s current disclosure of policies, practices and oversight.
Generally vote AGAINST proposals asking the company to affirm political nonpartisanship in the workplace so long as:
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There are no recent, significant controversies, fines or litigation regarding the company’s political contributions or trade association spending; and |
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The company has procedures in place to ensure that employee contributions to company-sponsored political action committees (PACs) are strictly voluntary and prohibits coercion. |
Generally vote AGAINST proposals requesting increased disclosure of a company’s policies with respect to political contributions, lobbying and trade association spending as long as:
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There is no significant potential threat or actual harm to shareholders’ interests; |
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There are no recent significant controversies or litigation related to the company’s political contributions or governmental affairs; and |
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There is publicly available information to assess the company’s oversight related to such expenditures of corporate assets. |
We generally will vote AGAINST proposals asking for detailed disclosure of political contributions or trade association or lobbying expenditures.
We generally will vote AGAINST proposals barring the company from making political contributions. Businesses are affected by legislation at the federal, state, and local level and barring political contributions can put the company at a competitive disadvantage.
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Region: Japan Proxy Items
The following section is a broad summary of the Guidelines, which form the basis of the Policy with respect to Japanese public equity investments of operating and/or holding companies. Applying these guidelines is not inclusive of all considerations in the Japanese market.
1. |
Operational Items |
Financial Results/Director and Auditor Reports
Vote FOR approval of financial statements and director and auditor reports, unless:
● |
There are concerns about the accounts presented or audit procedures used; or |
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The company is not responsive to shareholder questions about specific items that should be publicly disclosed. |
Appointment of Auditors and Auditor Fees
Vote FOR the re-election of auditors and proposals authorizing the board to fix auditor fees, unless:
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There are serious concerns about the accounts presented, audit procedures used or audit opinion rendered; |
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There is reason to believe that the auditor has rendered an opinion that is neither accurate nor indicative of the company’s financial position; |
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Name of the proposed auditor has not been published; |
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The auditors are being changed without explanation; |
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Non-audit-related fees are substantial or are in excess of standard annual audit-related fees; or |
● |
The appointment of external auditors if they have previously served the company in an executive capacity or can otherwise be considered affiliated with the company. |
Reincorporation Proposals
Vote reincorporation proposals on a CASE-BY-CASE basis.
Allocation of Income
Vote FOR approval of the allocation of income, unless:
● |
The dividend payout ratio is less than 20%, and is not appropriate or sufficient when considering the company’s financial position; or |
● |
The company proposes the payments even though the company posted a net loss for the year under review, and the payout is excessive given the company’s financial position; |
Amendments to Articles of Association
Vote amendments to the articles of association on a CASE-BY-CASE basis.
Change in Company Fiscal Term
Vote FOR resolutions to change a company’s fiscal term unless a company’s motivation for the change is to postpone its annual general meeting.
Amend Quorum Requirements
Vote proposals to amend quorum requirements for shareholder meetings on a CASE-BY-CASE basis.
Virtual Meetings
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Generally vote AGAINST proposals allowing for the convening of virtual-only* shareholder meetings.
* The phrase “virtual-only shareholder meeting” refers to a meeting of shareholders that is held exclusively through the use of online technology without a corresponding in-person meeting. The term “hybrid shareholder meeting” refers to an in-person, or physical, meeting in which shareholders are permitted to participate online.
2. |
Board of Directors and Statutory Auditors |
The board of directors should promote the interests of shareholders by acting in an oversight and/or advisory role; should have independent oversight of management; and should be held accountable for actions and results related to their responsibilities.
Voting on Director Nominees in Uncontested Elections
Vote on director nominees should be determined on a CASE-BY-CASE basis taking into consideration the following:.
● |
The company’s committee structure: statutory auditor board structure, U.S.-type three committee structure, or audit committee structure; or |
● |
Adequate disclosure has not been provided in a timely manner; or |
● |
There are clear concerns over questionable finances or restatements; or |
● |
There have been questionable transactions or conflicts of interest; or |
● |
There are any records of abuses against minority shareholder interests; or |
● |
The board fails to meet minimum corporate governance standards; or |
● |
There are reservations about: |
o |
Director terms |
o |
Bundling of proposals to elect directors |
o |
Board independence |
o |
Disclosure of named nominees |
o |
Combined Chairman/CEO |
o |
Election of former CEO as Chairman of the board |
o |
Overboarded directors |
o |
Composition of committees |
o |
Director independence |
o |
Number of directors on the board |
o |
Lack of gender diversity on the board |
● |
Specific concerns about the individual or company, such as criminal wrongdoing or breach of fiduciary responsibilities; or |
● |
There are other considerations which may include sanctions from government or authority, violations of laws and regulations, or other issues related to improper business practice, failure to replace management, or egregious actions related to service on other boards. |
Vote AGAINST top executives when the company has an excessive amount of strategic shareholdings.
Vote AGAINST top executives when the company has posted average return on equity (ROE) of less than five percent over the last five fiscal years.
Vote AGAINST top executives when the company does not disclose various components of current emissions, a proxy for a company’s dependency on fossil fuels and other sources of greenhouse gasses (such as Scope 1, Scope 2, Scope 3 emissions), material to the company’s business. For companies with 3-committee structure boards, vote AGAINST the Audit Committee Chair.
Board Composition
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We generally believe diverse teams have the potential to outperform and we expect the companies that we invest in to focus on the importance of diversity. When evaluating board composition, we believe a diversity of ethnicity, gender and experience is an important consideration. We encourage companies to disclose the composition of their board in the proxy statement and may vote against members of the board without disclosure. See below how we execute our vote at companies that do not meet our diversity expectations.
Vote AGAINST members of the Nominating Committee if the Board does not have at least 10% women directors. For Japanese boards with statutory auditors or audit committee structure, vote AGAINST top executives.
Director Independence
Classification of Directors
Inside Director
● |
Employee or executive of the company; |
● |
Any director who is not classified as an outside director of the company. |
Non-Independent Non-Executive Director (affiliated outsider)
● |
Any director specifically designated as a representative of a significant shareholder of the company; |
● |
Any director who is/was also an employee or executive of a significant shareholder of the company; |
● |
Beneficial owner (direct or indirect) of at least 10% of the company’s stock, or one of the top 10 shareholders, either in economic terms or in voting rights (this may be aggregated if voting power is distributed among more than one member of a defined group, e.g., family members who beneficially own less than 10% individually, but collectively own more than 10%) |
● |
Government representative; |
● |
Currently provides or previously provided professional services to the company or to an affiliate of the company; |
● |
Represents customer, supplier, creditor, banker, or other entity with which company maintains transactional/commercial relationship (unless company discloses information to apply a materiality test); |
● |
Any director who worked at the company’s external audit firm (auditor). |
● |
Any director who has conflicting or cross-directorships with executive directors or the chairman of the company; |
● |
Relative of a current employee of the company or its affiliates; |
● |
Any director who works or has worked at a company whose shares are held by the company in question as strategic shareholdings (i.e. “cross-shareholdings”) |
● |
Former executive; |
● |
Any director who has served at a company as an outside director for 12 years or more; |
● |
Any additional relationship or principle considered to compromise independence under local corporate governance best practice guidance. |
● |
“Cooling off period” for former employees or executives’ representation of significant shareholders and other stakeholders, as well as professional services is considered based on the market best practices and liquidity of executive labor market. |
Independent Non-Executive Directors (independent outsider)
● |
No material connection, either directly or indirectly, to the company other than a board seat. |
At companies adopting a board with a statutory auditor committee structure or an audit committee structure, vote AGAINST top executives when the board consists of fewer than two outside directors or less than 1/3 of the board consists of outside directors.
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At companies adopting an audit committee structure, vote AGAINST affiliated outside directors who are audit committee members.
At companies adopting a U.S.-type three committee structure, vote AGAINST members of Nominating Committee when the board consists of fewer than two outside directors or less than 1/3 of the board consists of outside directors.
At companies adopting a U.S.-type three committee structure, vote AGAINST affiliated outside directors when less than a majority of the board consists of independent outside directors.
At controlled companies adopting board with a statutory auditor structure or an audit committee structure, vote AGAINST top executives if the board does not consist of majority independent outside directors.
Director Accountability
Vote AGAINST individual outside directors who attend less than 75% of the board and/or committee meetings without a disclosed valid excuse.
Other items considered for an AGAINST vote include specific concerns about the individual or the company, such as criminal wrongdoing or breach of fiduciary responsibilities, sanctions from government or authority, violations of laws and regulations, the presence of inappropriate related party transactions, or other issues related to improper business practices
Vote AGAINST members of the full board or appropriate committee (or only the independent chairman or lead director as may be appropriate in situations such as where there is a classified board and members of the appropriate committee are not up for re-election or the appropriate committee is comprised of the entire board) for the below reasons. New nominees will be considered on a case-by-case basis. Extreme cases may warrant a vote against the entire board.
● |
Material failures of governance, stewardship, or fiduciary responsibilities at the company, including but not limited to violations of the United Nations Global Compact principles and/or other significant global standards and failure to disclose material environmental, social and governance information; |
● |
Egregious actions related to the director(s)’ service on other boards that raise substantial doubt about his or her ability to effectively oversee management and serve the best interests of shareholders at any company; |
● |
The board adopts or renews a poison pill without shareholder approval, does not commit to putting it to shareholder vote within 12 months of adoption (or in the case of a newly public company, does not commit to put the pill to a shareholder vote within 12 months following the IPO), or reneges on a commitment to put the pill to a vote, and has not yet received a withhold/against recommendation for this issue; |
● |
The board failed to act on takeover offers where the majority of the shareholders tendered their shares; |
● |
If in an extreme situation the board lacks accountability and oversight, coupled with sustained poor performance relative to peers. |
Voting on Director Nomineess in Contested Elections
Vote on a CASE-BY-CASE basis in contested elections of directors, e.g., the election of shareholder nominees or the dismissal of incumbent directors, determining which directors are best suited to add value for shareholders.
The analysis will generally be based on, but not limited to, the following major decision factors:
● |
Company performance relative to its peers; |
● |
Strategy of the incumbents versus the dissidents; |
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● |
Independence of board candidates; |
● |
Experience and skills of board candidates; |
● |
Governance profile of the company; |
● |
Evidence of management entrenchment; |
● |
Responsiveness to shareholders; |
● |
Whether a takeover offer has been rebuffed; |
● |
Whether minority or majority representation is being sought. |
Other Board Related Proposals (Management and Shareholder)
Vote AGAINST the introduction of classified boards and mandatory retirement ages for directors.
Vote AGAINST proposals to alter board structure or size in the context of a fight for control of the company or the board.
Independent Board Chair
We will generally vote AGAINST shareholder proposals requiring that the chairman’s position be filled by an independent director, if the company satisfies 3 of the 4 following criteria:
● |
Two-thirds independent board; |
● |
A designated, or a rotating, lead director, elected by and from the independent board members with clearly delineated and comprehensive duties; |
● |
Fully independent key committees; and/or |
● |
Established, publicly disclosed, governance guidelines and director biographies/profiles. |
Statutory Auditor Elections
Statutory Auditor Independence
Vote AGAINST affiliated outside statutory auditors.
For definition of affiliated outsiders, see “Classification of Directors”
Statutory Auditor Appointment
Vote FOR management nominees taking into consideration the following:
● |
Adequate disclosure has not been provided in a timely manner; or |
● |
There are clear concerns over questionable finances or restatements; or |
● |
There have been questionable transactions or conflicts of interest; or |
● |
There are any records of abuses against minority shareholder interests; or |
● |
The board fails to meet minimum corporate governance standards; or |
● |
Specific concerns about the individual or company, such as criminal wrongdoing or breach of fiduciary responsibilities; or |
● |
Outside statutory auditor’s attendance at less than 75% of the board and statutory auditor meetings without a disclosed valid excuse; or |
● |
Unless there are other considerations which may include sanctions from government or authority, violations of laws and regulations, or other issues related to improper business practice, failure to replace management, or egregious actions related to service on other boards. |
3. |
Compensation |
Director Compensation
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Vote FOR proposals to award cash fees to non-executive directors unless the amounts are excessive relative to other companies in the country or industry.
Vote non-executive director compensation proposals that include both cash and share-based components on a CASE-BY-CASE basis.
Vote proposals that bundle compensation for both non-executive and executive directors into a single resolution on a CASE-BY-CASE basis.
Vote AGAINST proposals to introduce retirement bonuses for outside directors and/or outside statutory auditors, unless the amounts are disclosed and are not excessive relative to other companies in the country or industry.
Compensation Plans
Vote compensation plans on a CASE-BY-CASE basis.
Director, Officer, and Auditor Indemnification and Liability Provisions
Vote proposals seeking indemnification and liability protection for directors and statutory auditors on a CASE-BY-CASE basis.
Vote AGAINST proposals to indemnify auditors.
4. |
Shareholder Rights and Defenses |
Antitakeover Mechanisms
Generally vote AGAINST all antitakeover proposals, unless certain conditions are met to ensure the proposal is intended to enhance shareholder value, including consideration of the company’s governance structure, the anti-takeover defense duration, the trigger mechanism and governance, and the intended purpose of the antitakeover defense.
5. |
Strategic Transactions and Capital Structures |
Reorganizations/Restructurings
Vote reorganizations and restructurings on a CASE-BY-CASE basis.
Mergers and Acquisitions
Vote CASE-BY-CASE on mergers and acquisitions taking into account the following based on publicly available information:
● |
Valuation; |
● |
Market reaction; |
● |
Strategic rationale; |
● |
Management’s track record of successful integration of historical acquisitions; |
● |
Presence of conflicts of interest; and |
● |
Governance profile of the combined company. |
Dual Class Structures
Vote FOR resolutions that seek to maintain or convert to a one-share, one-vote capital structure.
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Vote AGAINST requests for the creation or continuation of dual-class capital structures or the creation of new or additional super voting shares.
Share Issuance Requests
General Issuances:
Vote FOR issuance requests with preemptive rights to a maximum of 100% over currently issued capital.
Vote FOR issuance requests without preemptive rights to a maximum of 20% of currently issued capital.
Specific Issuances:
Vote on a CASE-BY-CASE basis on all requests, with or without preemptive rights.
Increases in Authorized Capital
Vote FOR non-specific proposals to increase authorized capital up to 100% over the current authorization unless the increase would leave the company with less than 30% of its new authorization outstanding.
Vote FOR specific proposals to increase authorized capital to any amount, unless:
● |
The specific purpose of the increase (such as a share-based acquisition or merger) does not meet guidelines for the purpose being proposed. |
Vote AGAINST proposals to adopt unlimited capital authorizations.
Reduction of Capital
Vote FOR proposals to reduce capital for routine accounting purposes unless the terms are unfavorable to shareholders.
Vote proposals to reduce capital in connection with corporate restructuring on a CASE-BY-CASE basis.
Preferred Stock
Vote FOR the creation of a new class of preferred stock or for issuances of preferred stock up to 50% of issued capital unless the terms of the preferred stock would adversely affect the rights of existing shareholders.
Vote FOR the creation/issuance of convertible preferred stock as long as the maximum number of common shares that could be issued upon conversion meets guidelines on equity issuance requests.
Vote AGAINST the creation of a new class of preference shares that would carry superior voting rights to the common shares.
Vote AGAINST the creation of blank check preferred stock unless the board clearly states that the authorization will not be used to thwart a takeover bid.
Vote proposals to increase blank check preferred authorizations on a CASE-BY-CASE basis.
Share Repurchase Plans
We will generally recommend FOR share repurchase programs taking into account whether:
● |
The share repurchase program can be used as a takeover defense; |
● |
There is clear evidence of historical abuse; |
● |
There is no safeguard in the share repurchase program against selective buybacks; |
● |
Pricing provisions and safeguards in the share repurchase program are deemed to be unreasonable in light of market practice. |
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Related-Party Transactions
Vote related-party transactions on a CASE-BY-CASE basis, considering factors including, but not limited to, the following:
● |
The parties on either side of the transaction; |
● |
The nature of the asset to be transferred/service to be provided; |
● |
The pricing of the transaction (and any associated professional valuation); |
● |
The views of independent directors (where provided); |
● |
The views of an independent financial adviser (where appointed); |
● |
Whether any entities party to the transaction (including advisers) is conflicted; and |
● |
The stated rationale for the transaction, including discussions of timing. |
6. |
Environmental and Social Issues |
Overall Approach
Proposals considered under this category could include, among others, reports on:
1) |
employee labor and safety policies; |
2) |
impact on the environment of the company’s production or manufacturing operations; |
3) |
societal impact of products manufactured; |
4) |
risks throughout the supply chain or operations including labor practices, animal treatment practices within food production and conflict minerals; and |
5) |
overall board structure, including diversity. |
When evaluating environmental and social shareholder proposals, the following factors are generally considered:
● |
The company’s current level of publicly available disclosure, including if the company already discloses similar information through existing reports or policies; |
● |
If the company has implemented or formally committed to the implementation of a reporting program based on the Sustainability Accounting Standards Board’s (SASB) materiality standards, the Task Force on Climate-related Financial Disclosure’s (TCFD) recommendations, or a similar standard; |
● |
Whether adoption of the proposal is likely to enhance or protect shareholder value; |
● |
Whether the information requested concerns business issues that relate to a meaningful percentage of the company’s business; |
● |
The degree to which the company’s stated position on the issues raised in the proposal could affect its reputation or sales, or leave it vulnerable to a boycott or selective purchasing; |
● |
Whether the company has already responded in some appropriate manner to the request embodied in the proposal; |
● |
What other companies in the relevant industry have done in response to the issue addressed in the proposal; |
● |
Whether the proposal itself is well framed and the cost of preparing the report is reasonable; |
● |
Whether the subject of the proposal is best left to the discretion of the board; |
● |
Whether the company has material fines or violations in the area and if so, if appropriate actions have already been taken to remedy going forward; |
● |
Whether providing this information would reveal proprietary or confidential information that would place the company at a competitive disadvantage. |
Environmental Issues
Climate Transition Plans
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Generally vote CASE-BY-CASE on management proposed climate transition plans. When evaluating management proposed plans, the following factors are generally considered:
● |
If the company has detailed disclosure of the governance, strategy, risk mitigation efforts, and metrics and targets based on the TCFD’s recommendations, or a similar standard; |
● |
If the company has detailed disclosure of their current emissions data based on the SASB materiality framework; and |
● |
If the company has detailed disclosure in line with Paris Agreement goals. |
Generally vote CASE-BY-CASE on shareholder proposals requesting climate transition plans. When evaluating these shareholder proposals, the following factors are generally considered:
● |
The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
● |
If the proposal asks for detailed disclosure according to the TCFD’s recommendations; |
● |
If the proposal asks for detailed disclosure of the company’s current emissions data based on the SASB materiality framework; |
● |
If the proposal asks for long-term targets, as well as short and medium term milestones; |
● |
If the proposal asks for targets to be aligned to a globally accepted framework, such as Paris Aligned or Net Zero; |
● |
If the proposal asks for targets to be approved by the Science Based Target Initiative (“SBTi”); |
● |
If the proposal seeks to add reasonable transparency and is not onerous or overly prescriptive; and |
● |
Whether the proposal is binding or non-binding. |
Environmental Sustainability Reporting
Generally vote FOR shareholders proposals requesting the company to report on its policies, initiatives and oversight mechanisms related to environmental sustainability, including the impacts of climate change and biodiversity loss. The following factors will be considered:
● |
The company’s current level of publicly available disclosure including if the company already discloses similar information through existing reports or policies; |
● |
If the company has formally committed to the implementation of a reporting program based on the SASB materiality standards, the TCFD’s recommendations, or a similar standard within a specified time frame; |
● |
If the company’s current level of disclosure is comparable to that of its industry peers; and |
● |
If there are significant controversies, fines, penalties, or litigation associated with the company’s environmental performance. |
Other Environmental Proposals
Vote CASE-BY-CASE on the following shareholder proposals if relevant to the company:
● |
Seeking information on the financial, physical, or regulatory risks a company faces related to climate change on its operations and investment, or on how the company identifies, measures and manages such risks; |
● |
Calling for the reduction of Greenhouse Gas (GHG) emissions; |
● |
Seeking reports on responses to regulatory and public pressures surrounding climate change, and for disclosure of research that aided in setting company policies around climate change; |
● |
Requesting an action plan including science based targets and a commitment to net zero emissions by 2050 or earlier; |
● |
Requesting a report/disclosure of goals on GHG emissions from company operations and/or products; |
● |
Requesting a company report on its energy efficiency policies; and |
● |
Requesting reports on the feasibility of developing renewable energy resources. |
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Social Issues
Board and Workforce Demographics
A company should have a clear, public Equal Employment Opportunity (EEO) statement and/or diversity policy. Generally vote FOR proposals seeking to amend a company’s EEO statement or diversity policies to additionally prohibit discrimination based on sexual orientation and/or gender identity.
Generally vote FOR proposals requesting reports on a company’s efforts to diversify the board, unless:
● |
The gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business; and |
● |
The board already reports on its nominating procedures and gender and racial minority initiatives on the board. |
Gender Pay Gap
Generally vote CASE-BY-CASE on proposals requesting reports on a company’s pay data by gender, or a report on a company’s policies and goals to reduce any gender pay gap, taking into account:
● |
The company’s current policies and disclosure related to both its diversity and inclusion policies and practices and its compensation philosophy and fair and equitable compensation practices; |
● |
Whether the company has been the subject of recent controversy, litigation or regulatory actions related to gender pay gap issues; and |
● |
Whether the company’s reporting regarding gender pay gap policies or initiatives is lagging its peers. |
Labor, Human and Animal Rights Standards
Generally vote FOR proposals requesting a report on company or company supplier labor, human, and/or animal rights standards and policies, or on the impact of its operations on society, unless such information is already publicly disclosed considering:
● |
The degree to which existing relevant policies and practices are disclosed; |
● |
Whether or not existing relevant policies are consistent with internationally recognized standards; |
● |
Whether company facilities and those of its suppliers are monitored and how; |
● |
Company participation in fair labor organizations or other internationally recognized human rights initiatives; |
● |
Scope and nature of business conducted in markets known to have higher risk of workplace labor/human rights abuse; |
● |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; |
● |
The scope of the request; and |
● |
Deviation from industry sector peer company standards and practices. |
Generally vote CASE-BY-CASE on shareholder proposals requesting reports about a company’s use of mandatory arbitrations in employment claims, taking into account the company’s existing policies and disclosures of policies.
Generally vote CASE-BY-CASE on shareholder proposals requesting reports on the actions taken by a company to prevent sexual and other forms of harassment or on the risks posed by the company’s failure to take such actions, taking into account the company’s existing policies and disclosures of policies.
Racial Equity Audit
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• |
Generally vote CASE-BY-CASE on shareholder proposals requesting the board oversee a racial equity audit. While we believe the decision to initiate an independent audit is best left to management judgment under the oversight of the board of directors, the following factors are generally considered: |
• |
The degree to which existing relevant policies and practices are disclosed; |
• |
Recent, significant company controversies, fines, or litigation regarding human rights at the company or its suppliers; and |
Whether the gender and racial minority representation of the company’s board is reasonably inclusive in relation to companies of similar size and business.
Political Contributions and Trade Association Spending/Lobbying Expenditures and Initiatives
We generally believe that it is the role of boards and management to determine the appropriate level of disclosure of all types of corporate political activity. When evaluating these proposals, we consider the prescriptive nature of the proposal and the overall benefit to shareholders along with a company’s current disclosure of policies, practices and oversight.
Generally vote AGAINST proposals asking the company to affirm political nonpartisanship in the workplace so long as:
● |
There are no recent, significant controversies, fines or litigation regarding the company’s political contributions or trade association spending; and |
● |
The company has procedures in place to ensure that employee contributions to company-sponsored political action committees (PACs) are strictly voluntary and prohibits coercion. |
Generally vote AGAINST proposals requesting increased disclosure of a company’s policies with respect to political contributions, lobbying and trade association spending as long as:
● |
There is no significant potential threat or actual harm to shareholders’ interests; |
● |
There are no recent significant controversies or litigation related to the company’s political contributions or governmental affairs; and |
● |
There is publicly available information to assess the company’s oversight related to such expenditures of corporate assets. |
We generally will vote AGAINST proposals asking for detailed disclosure of political contributions or trade association or lobbying expenditures.
We generally will vote AGAINST proposals barring the company from making political contributions. Businesses are affected by legislation at the federal, state, and local level and barring political contributions can put the company at a competitive disadvantage.
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