ISS Recommends Shareholders Support Significant Change At Norfolk Southern by Voting the Blue Proxy Card “FOR” Five of Ancora’s Director Candidates
- ISS Confirms Jim Barber is a “Capable Candidate with Experience and Skills that Should be Transferable to the Railroad Industry, Which Makes Him a Credible Director and CEO Candidate”
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ISS Joins Glass Lewis in Recommending Shareholders “WITHHOLD” on Chair
Amy Miles (~10-Year Tenure) and Several Other Incumbents
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Report Follows a Separate Recommendation from Glass Lewis to Elect Six Ancora Nominees (Including
Jim Barber ) and “WITHHOLD” on Six Incumbents (Including CEOAlan Shaw )
- Together, ISS and Glass Lewis Endorse Significant Shareholder-Driven Change by Supporting Ancora’s Director Candidates
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Ancora Urges Shareholders to Support a Referendum by Electing its Full Slate, Which is the
Only Way to EnsureJim Barber and Jamie Boychuk Implement a PSR-Powered Scheduled Network
Notably, both ISS and Glass Lewis recommend AGAINST Norfolk Southern’s proposed executive compensation. ISS is concerned by the effect of excluding costs associated with the derailment in
“The leading proxy advisory firms have collectively sent a clear message about the need for significant, shareholder-driven change at
As we continue to tell shareholders, this contest should come down to a simple question:
Do you want
If the answer to this question is ‘yes,’ we need to turn the page on this dark chapter and install all seven members of the Shareholder Slate. This is the only way to ensure
***
In its report, ISS made the following points regarding the need for change at
- “It is important to establish from the outset that there is a clear case for change.”
- “All in, the prevailing strategy has yet to translate into lasting operational improvements, and TSR has underperformed peers over every relevant measurement period.”
- “Shareholders have also been provided with numerous reasons to believe that their best interests are not being prioritized by the board. These are serious problems, and they reflect underlying issues with oversight and accountability that will require substantial change to rectify.”
ISS made the following comments with respect to the incumbent Board and management’s decisions:2
- “[T]he board has made compensation decisions that are challenging to justify, orchestrated an expensive hire as part of a defensive maneuver in this proxy contest, and established a pattern of insufficient disclosure on key matters.”
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“[COO
John Orr ] was hired under concerning circumstances – at a substantial (and perhaps not fully understood) cost to the company – which is effectively an indictment of the board.”
- "This is a clear sign of reactive, rather than proactive oversight […] there are concerns about the board's related messaging in this proxy contest, including the assertions it has made about its progress thus far and the comparative safety of its strategy relative to that of the dissident."
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“As board chair,
Amy Miles arguably bears the most responsibility for this state of affairs. She has a decade of tenure, and her leadership of the board has coincided with many of the concerning developments underpinning the dissident's case for change.”
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“Replacing Miles,
Thompson , and Scanlon with dissident nominees possessing deep expertise in railroad operations and safety (Sameh Fahmy ,Gilbert Lamphere , andWilliam Clyburn ) would remove the majority of the cohort most responsible for the board's disconnect with shareholders, while infusing needed independence and a diversity of perspective on key strategy, operational, and regulatory matters.”
ISS also noted the following with regard to the Shareholder Slate’s proposed strategy and management team, stating:3
- “In fact, the dissident has received public support from several different types of shareholders, including labor unions, as well as at least one large customer, which suggests that its arguments have broad appeal.”
- “It is important to recognize that the dissident has also articulated a plan that appears logical (the underlying model has been implemented successfully at other Class I railroads), and has assembled a credible management team that features a COO with proven experience.”
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“Although we are not supporting dissident nominee and CEO selection
James Barber , he appears to be a capable candidate with experience and skills that should be transferable to the railroad industry, which makes him a credible director and CEO candidate.”
- “It would therefore be justifiable for shareholders who have already lost faith in the current management team to support the entire dissident slate.”
About Ancora
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The participants in the proxy solicitation are
Ancora Alternatives and the other Participants have filed a definitive proxy statement and accompanying BLUE proxy card (the “Definitive Proxy Statement”) with the
IMPORTANT INFORMATION AND WHERE TO FIND IT
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1 Permission to use quotations from ISS was neither sought nor obtained.
2 Permission to use quotations from ISS was neither sought nor obtained.
3 Permission to use quotations from ISS was neither sought nor obtained.
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