Salesforce Inc. shareholder support for Chief Executive Officer Marc Benioff grew in the past year following a tussle with activist investors who pushed for spending cuts and greater profits.
Fewer stockholders backed a proposal suggesting the board be led by someone other than a current or former CEO than voted last year. The nonbinding proposal, which is effectively a referendum on whether Benioff should continue to hold the role of board chairman, received about 23% of the vote at the company’s annual meeting June 8, compared with just less than 37% a year ago, according to regulatory filings.
Salesforce has been winning back shareholders after a tumultuous six months that included job cuts, executive departures and public pressure from activist investors. The software maker ratcheted up its focus on profit and ended a controversial acquisition strategy. The stock has jumped 61% this year, making it one of the top 10 gainers in the S&P 500.
Influential advisory firm Institutional Shareholder Services Inc. recommended against the proposals, saying “the board has made several recent positive structural changes including the reduction of the complexity of its leadership structure.” The same firm supported a similar effort last year, adding that it can be difficult to balance a board led by a founder and longtime CEO.
Benioff became sole CEO again after the January departure of heir apparent Bret Taylor. One request from activist investor Elliott Investment Management that wasn’t accepted during negotiations with the company was better succession planning.
Salesforce Chief Operating Officer Brian Millham has taken on some of Taylor’s previous duties and recently has been making more public appearances. When Benioff was asked Monday at a company event whether Millham would be the next co-CEO, he said, “I don’t think I have another co-CEO right now, but I couldn’t be more excited about Brian.”
The proxy was submitted by the National Legal and Policy Center, a conservative group that took issue with Benioff’s support for causes like abortion access and diverse hiring. A similar initiative by the group aimed at Berkshire Hathaway Inc. failed last month.
Still, the proposal was backed by advisory firm Glass Lewis for corporate governance reasons. An independent chair “eliminates the conflict of interest that inevitably occurs when a CEO is responsible for self-oversight,” Glass Lewis said in a report.
