Employee Stockholders Guide to Voting on
Annual Meeting Proposals
What is proxy voting?
Voting by proxy allows stockholders to
voice their opinion on important issues that will be considered at Allstates
annual stockholder meeting, without having to attend the meeting. Stockholders
can vote in advance on the matters to be considered at the meeting.
Why are stockholders votes gathered
this way?
Voting by proxy is a common practice among
publicly traded companies, because it allows stockholders to express their
opinion without having to attend the companys annual meeting. Typically, few
stockholders attend a companys annual meeting in person. Widely-held companies
like Allstate have stockholders around the world; voting by proxy is a more
convenient way to vote shares on proposals.
Why do stockholders have a vote?
When someone has an investment interest in
Allstate or another companys stock, they have a financial stake in its success.
Our annual stockholder meeting and vote give stockholders an important
opportunity to voice their opinion on the election of the board of directors and
other governance matters.
Through the annual meeting process,
employee stockholders have an opportunity to influence the companys corporate
governance by voting their shares, just as they help to drive Allstates success
through the work they do every day.
Why is Allstate encouraging me to vote?
Every vote matters, including those of our
employee stockholders. All stockholders including employees are encouraged
to vote.
Why is Allstate providing more
information about the annual meeting and vote?
It is important for employee stockholders
to understand the issues and add their voices to the dialogue. The proxy vote
process and issues up for vote can be confusing, and we dont want that to
discourage employee stockholders from participating. As with any significant
decision, it is important to gather the facts and feel comfortable with the
process.
To help, Allstate offers an
overview of proposals
that provides more information about the issues. This
resource is meant to help employees feel comfortable with the voting process and
issues up for vote.
What issues are up for vote in 2017?
Allstate stockholders will be asked to
vote on governance items, including the election of the board of directors. More
information is available in the
Notice of 2017 Annual Meeting and Proxy
Statement
. Please review this information before voting.
The items up for vote are:
1. Election of 10 directors
2. Say-on-pay advisory vote on the
executive compensation of the named executives
3. Advisory vote on the frequency of
future advisory votes on the compensation of the named executives
4. Approval of The Allstate Corporation
2017 Equity Compensation Plan for Non-Employee Directors
5. Ratification of auditors ratification
of Deloitte & Touche LLP as Allstate's independent registered public
accountant for 2017
6. Stockholder proposal on independent
board chairman
7. Stockholder proposal on lead director qualifications
8.
Stockholder proposal on reporting political contributions
How can I vote?
Employees who own shares of Allstate stock
will receive a notice that the proxy materials and voting instructions are
available. Most of these employee stockholders will begin receiving it by email
from The Allstate Corporation during the week of April 12, with the subject line
Vote now on The Allstate Corporations annual meeting proposals, while others
will receive the email from their broker. Some employees may receive materials
by postal mail if they previously selected this delivery option.
In either case, stockholders may vote by
following the instructions in the materials.
How do I set my delivery preferences
for proxy materials?
Each year, an Allstate NOW article is
published to remind employees that they can opt out of electronic delivery of
proxy materials. However, employees can change their election at any time by
following the processes set forth in the materials they receive.
Will Allstate leaders or employees know
how I vote?
No. Allstate has a confidential voting
policy that applies to all votes cast, including employee votes. All votes are
confidential and managed by an outside firm to maintain confidentiality, except
as necessary to allow the inspector of election to certify the vote result or
meet certain legal requirements. The votes are tabulated by an independent
outside vendor, and the results are certified by an independent inspector of
election. However, if a stockholder provides a comment on his or her ballot, and
knowing the vote is important to understand the comment, then the comment and
the vote may be disclosed to the corporate secretary.
What happens if I dont vote?
Stockholders who decide not to vote will
miss an opportunity to voice their opinion. However, the decision about whether
to vote will not affect their status as an Allstate stockholder. The trustee of
the Allstate 401(k) Savings Plan, The Northern Trust Corp., will vote any shares
not voted by plan participants. If less than 50 percent of shares held by
participants are voted, the trustee would use its sole discretion to vote
unvoted shares. If at least 50 percent of the shares held by participants are
voted, the trustee would vote all other shares in the same proportion and in the
same manner as the shares that have been voted, unless to do so would be
inconsistent with the trustees duties.
When will the annual meeting take
place? Can I attend?
The annual meeting is scheduled to begin
at 11 a.m. on Thursday, May 25, at North Plaza Auditorium in home office. All
Allstate stockholders are invited to attend. Registration begins at 10 a.m.
Stockholders are encouraged to pre-register to attend the annual meeting by
following the instructions in the proxy statement. You may also register
on-site, but to do so, you will need to bring information with you to be
confirmed as a stockholder.
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If you hold your shares beneficially
(through a bank or broker), you must bring a statement showing your
ownership on March 27, 2017, in order to attend the
meeting.
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Participants in the Allstate 401(k)
Savings Plan may attend the meeting, but may not vote the shares credited
to their accounts at the meeting. All voting instructions for shares in
the Allstate 401(k) Savings Plan must be received by May 22, 2017, so the
trustee can tabulate and vote the shares.
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Commencing on or about April 13, 2017, The Allstate Corporation made the following intranet webpage
available to employees:
Understanding the 2017 Proposals
Employee Stockholders Guide to Voting
on Annual Meeting Proposals
Each year, Allstate stockholders are asked
to consider and vote on proposals related to important governance matters. Some
of the issues can be challenging to understand. The 2017 proposals are listed
below, followed by explanations to help you understand the matters up for
vote.
The
proxy
statement
and the descriptions below provide the vote recommendation of the
Allstate board of directors. These recommendations are based on the boards view
of what is best for stockholders and the corporation. Please review the proxy
statement and annual report before voting. The board recommends you vote FOR
each director and Proposals 2, 4 and 5, for 1 Year for Proposal 3, and
AGAINST for Proposals 6, 7 and 8.
Proposal 1 Election of 10 directors
Who are the directors of The Allstate
Corporation?
The Allstate Corporation has 10 nominees
for election as directors at the 2017 annual meeting. Nine of the directors are
independent from Allstate, which means they are not Allstate employees and have
no relationships with the company that would create a conflict of interest that
would impair independence. Tom Wilson, chairman and CEO, is the only Allstate
employee on the board. For more information, see the biographies of the board
members, beginning on page 12 of the
2017 proxy statement
.
Why do we vote to elect our board of
directors every year?
Allstates practice of electing each
director every year is considered good governance, as it allows stockholders the
opportunity to vote on each directors continued service in each
year.
What is the vote standard required to
elect an Allstate director?
Each Allstate director must receive a
majority of affirmative or for votes out of the votes cast. Some companies
apply a plurality vote standard, which means a director can be elected by less
than a majority of votes cast.
Proposal 2 Say-on-pay
advisory
vote on the executive compensation of the named executives
Why do stockholders get to vote on
executive compensation?
The Dodd-Frank Act required public
companies to provide stockholders with the opportunity to cast an advisory vote
on the companys executive compensation program for named executive officers.
The vote is nonbinding, but it gives stockholders an opportunity to voice any
concerns about a companys executive compensation program. Allstates
compensation and succession committee (a committee of the board) takes the
stockholder vote into consideration when it conducts its annual review of the
compensation program.
How does the board of directors
determine executive compensation?
The compensation and succession committee
of the board of directors works with an independent compensation consultant to
design an executive compensation program that aligns compensation with the
companys strategic and operational business goals. In designing such a program,
the committee examines market pay and practices at a group of peer companies and
uses the 50th percentile of this peer group as a guideline in setting target
direct compensation. To read more about this, see the 2017
proxy
statement.
Proposal 3 Advisory vote on the
frequency of future advisory votes on the compensation of the named
executives
Why do stockholders get to vote on the
frequency of future advisory votes on executive compensation?
The Dodd-Frank Act required public
companies to provide stockholders with the opportunity to cast an advisory vote
on the frequency of future votes on the executive compensation program for named
executive officers. Shareholders are given the opportunity to vote on frequency
every six years. The vote is nonbinding, but it gives stockholders an
opportunity to specify the frequency to conduct the advisory vote on executive
compensation every year, every two years, every three years, or abstain from
voting this proposal altogether. Allstates Board of Directors intends to adopt
the frequency supported by the largest numbers of votes cast.
Proposal 4 Approval of The Allstate
Corporation 2017 Equity Compensation Plan for non-employee directors
Why do stockholders get to vote on the
approval of the equity compensation plan for non-employee directors?
Stockholders must be given the opportunity
to vote on director equity compensation plans. This new 2017 Plan will become
effective upon stockholder approval and is intended to replace The Allstate
Corporation 2006 Equity Compensation Plan for Non-Employee Directors. The
purpose of the 2017 Equity Compensation Plan for Non-Employee Directors is to
help align long-term interests of the directors with interests of Allstates
stockholders and customers. Allstate cannot make equity awards to non-employee
directors beyond the remaining allotment under the 2006 plan. The new Plan
authorizes 400,000 shares for equity grants to Allstates independent
directors.
Proposal 5 Ratification of auditors
ratification of Deloitte & Touche LLP as Allstates independent
registered public accountant for 2017
Why do we vote to ratify the auditors?
The audit committee of the board of
directors annually appoints an independent registered public accounting firm.
Stockholders are asked to ratify the appointment. If the appointment is not
ratified by stockholders, the committee may reconsider which accounting firm to
appoint. The
proxy statement
contains details on the fees paid to Deloitte &
Touche LLP for 2016 and 2015.
Proposals 6-8 Stockholder
proposals
What is a stockholder proposal?
Stockholders who meet certain eligibility
requirements set by the Securities and Exchange Commission can submit a proposal
to be included in the companys annual proxy statement. There are three
stockholder proposals in the 2017 proxy statement.
Proposal 6
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This stockholder
proposal
is asking
for the board of directors to adopt as policy and amend the governing
documents as necessary, to require the chair of the board of directors,
whenever possible, to be an independent member of the board. The board of
directors recommends that stockholders vote against this proposal because
Allstates independent lead director provides meaningful independent
leadership of the board. The board should continue to have the flexibility
to determine whether to split or combine the chair and CEO roles and not
be required to utilize one approach. In addition, the board has split the
roles of chair and CEO in the past. Finally, the lead director is just one
of many structural safeguards that provide effective independent oversight
of Allstate. See pages 76-78 of the
proxy statement
for more information.
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Proposal 7
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This stockholder
proposal
is asking for the board of directors to adopt a
rule, that whenever possible, Allstates lead director have less that
12-years tenure. The board of directors recommends that stockholders vote
against this proposal because this proposal seeks to establish a new
independence standard that is inconsistent with public stock exchange
listing standards. Allstates nominating and governance committee
specifically evaluated the impact of Ms. Spriesers tenure and concluded
it had no impact on her independence. In addition, Allstates independent lead director is selected through a robust
process, and her performance is evaluated annually. Finally, the board
believes it is important to maintain a mix of director tenures. See pages
79-80 of the
proxy statement
for more information.
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Proposal 8
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This stockholder
proposal
is asking for a policy to require that Allstate
provide a report, updated semi-annually, disclosing the companys
political contributions. The board of directors recommends that
stockholders vote against this proposal because Allstate already provides
stockholders with comprehensive disclosure on Allstates involvement in
the public policy arena (found at
www.allstate.com/publicpolicyreport
).
Also, the board has strong governance and oversight practices over the
companys public policy involvement. Lastly, Allstate surpasses all
disclosure requirements pertaining to political contributions under
federal, state, and local laws. See pages 81-82 of the
proxy statement
for
more information.
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Commencing on or about April 13, 2017, The Allstate Corporation sent the following communication to
employees:
From:
Harriet Harty
Date:
Thursday, April 13, 2017
Subject:
Your vote matters:
Voting on Allstate's annual meeting proposals
At Allstate, you're not just empowered to
help shape our future, you're expected to lead the way. This concept is central
to our Leadership Principles and why, with Allstate's annual meeting approaching
I want to remind all employee stockholders how important it is to vote your
Allstate shares and help influence our corporate governance.
To help you prepare for the annual
meeting, you should review the Notice of 2017 Annual Meeting, Proxy Statement
and the 2016 Annual Report. We want you to understand the issues up for vote and
feel comfortable with the voting process.
This year, stockholders are asked to
consider and vote on the following issues:
1.)
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Election of 10
directors
|
2.)
|
Say-on-pay: advisory vote on the
compensation of named executives
|
3.)
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Advisory vote on the frequency of
future advisory votes on the compensation of named executives
|
4.)
|
Approval of The Allstate Corporation
2017 Equity Compensation Plan for Non-Employee Directors
|
5.)
|
Ratification of the appointment of
Deloitte & Touche LLP as Allstate's independent registered public
accountant for 2017
|
6.)
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Stockholder Proposal on Independent
Board Chairman
|
7.)
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Stockholder Proposal on Lead
Director Qualifications
|
8.)
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Stockholder Proposal on Reporting
Political Contributions
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If you own shares as a registered
stockholder, as a beneficial stockholder or as a participant in the Allstate
401(k) plan, you will receive a notice when the proxy materials are available.
Unless you previously elected to receive it by postal mail, this notice will
come via an email from The Allstate Corporation beginning on or around April 12.
We joined Allstate to make a difference.
One way you can do that is by exercising your ownership role and influencing the
company's corporate governance. I encourage you to take the time to vote.
Together, lets use our voices, our votes and Our Shared Purpose to make that
difference.
Harriet Harty
Executive Vice President
Human Resources