Chipotle Mexican Grill Inc. shareholders Thursday rejected by a vote of 77% against the executive pay package for Steve Ells, chairman of the company’s board and co-CEO; Montgomery F. Moran, co-CEO; and two other top executives.
The $183.3 billion California State Teachers’ Retirement System, West Sacramento, $178.6 billion Florida State Board of Administration, Tallahassee, and $1 billion American Federation of State County & Municipal Employees Pension Plan, Washington, voted against ratifying the executive pay in non-binding say-on-pay voting, according to their proxy-vote disclosures.
CtW Investment Group — which works with pension funds sponsored by affiliates of the Change to Win federation of unions — led a campaign against the executive pay.
Glass Lewis & Co. and Institutional Shareholder Services recommended clients vote against the executive pay, while Egan-Jones Proxy Services recommended its clients support it, according to the proxy-voting advisory firms’ reports.
In response to the voting result, Chris Arnold, Chipotle communications director, said in an e-mail, “This year, shareholder support for our say-on-pay proposal was about 23% of the shares voted. We take this very seriously. It has always been, and continues to be, a top priority that our compensation programs are driving the creation of shareholder value. We thank our investors for the feedback we have received on this issue, and will continue to engage with our investors as we review our compensation programs that build value for all of our investors.”
Shareholders also rejected a binding company proposal amending an employee stock incentive plan. CalSTRS, FSBA, the AFSCME plan, Glass Lewis and ISS all opposed the stock incentive plan.
A shareholder proposal calling for ending supermajority vote requirements, such as for corporate bylaw changes, was passed with a majority of votes.
All the pension funds, ISS and Glass Lewis supported the proposal to end supermajority voting, while Egan-Jones opposed it.
Shareholders elected all nominees for director, despite opposition by CalSTRS and the AFSCME plan to John S. Charlesworth. The AFSCME plan also opposed Mr. Moran’s election.
A shareholder proposal calling for sustainability disclosure was rejected.
FSBA, Glass Lewis and Egan-Jones opposed the sustainability disclosure. The other pension funds and ISS supported the proposal.
Mr. Arnold provided the proxy-voting results, giving a vote tally only for the say-on-pay proposal.