Ontario Teachers’ Pension Plan, Toronto, will vote against Coca-Cola Co.’s 2014 executive compensation and equity plan, according to the C$140.8 billion (US$128.9 billion) plan’s website.
The Coca-Cola proposal does not meet the pension fund’s guidelines on equity compensation, exceeding limits OTPP has set for total potential dilution of shares and burn rates, or negative cash flow, according to the posting.
The dilution rate of 20% “considerably exceeds” the pension fund’s 5% dilution rate guideline, said Deborah Allan, OTPP spokeswoman.
According to Coca-Cola’s website, “The actual dilution related to existing equity plans over the last three years has been less than 1% per year and is expected to be in this range going forward. Our plan … is closely in line with past equity plans and within industry norms. The board fully stands behind the company’s compensation program.”
Coca-Cola’s annual meeting is scheduled for April 23.
Ontario Teachers holds 741,000 shares of Coca-Cola, valued at C$31.2 million, according to SEC filings.
