You’d be surprised about the amount of information you can gather by looking over a company’s proxy statement, especially if you learn to read between the lines.
A proxy statement is an openly accessible document that must be filed annually by all companies that are publicly traded. A typical proxy statement includes high-level overviews of the company’s performance from the last year, compensation details for their higher-ranking employees and executives, Environmental, Social, and Governance and Diversity, Equity, and Inclusion goals, and a letter from the CEO or Chairman. These records are used by shareholders to prepare themselves for the annual shareholder meeting and to make informed decisions on various voting matters. However, anyone can access public records, commonly through the company’s website. If you’re interested in seeing proxies in action, choose the first public company that comes to mind and find their proxy statement. While reading it through, try to come up with a few broad questions about the company, and ask yourself the following:
“What conclusions can I make about this company from the way they design their executives’ compensation packages?”
“Where does the CEO envision the company going in the next year based on what they say in their letter?”
“Which company is leading its industry’s compensation market, and is that at all correlated to their ESG/RSI goals?”
On Tuesday, June 22nd, Auxin Group is hosting an interactive session “Company Proxy Statements: Reading Between The Lines” presented by Carolyn Belmore. (Non-Member Tickets available here) In our interactive session, we will review current trends from research on companies from a variety of industries. We will showcase Apple and Alpha in an industry comparison activity.
See you there!