By Paul Ziobro
Target Corp. shareholders approved all 10 nominees to the
company's board, shrugging off calls from a prominent advisory firm
to throw out a majority of the candidates for their handling of
last year's data breach.
Target's interim chairwoman, Roxanne Austin, said Wednesday at
the company's annual meeting that all nominees won a majority of
the vote. Shareholders also supported the company in an advisory
vote on executive pay. All three shareholder proposals, including
one calling for an independent chairman, failed.
The tallies of the votes weren't immediately available.
Target faced stiff criticism ahead of the annual meeting.
Institutional Shareholder Services Inc., which advises large
shareholders how to vote on corporate ballots, recommended that
shareholders vote out seven of the 10 directors for failing to
manage risks and protect the company from the massive data breach
that hit the retailer during the holiday shopping season.
It was an unusual recommendation from ISS, which only rarely
calls for overthrowing a majority of a company's board nominees.
But the firm argued that the members targeted for defeat, who sit
on the audit and corporate responsibility committees, "set the
stage for the data breach" by inadequately managing the risks.
Another proxy advisory firm, Glass, Lewis & Co., said there
wasn't enough information yet about the data breach to draw
conclusions about board responsibility, but it did recommend that
shareholders vote out Target's two longest serving board members,
former Xerox Corp. Chief Executive Anne Mulcahy and former head of
Fannie Mae James Johnson, primarily for their track record on other
corporate boards.
The annual meeting was straightforward, with around 100
attendees gathering at Union Station in downtown Dallas. The
setting allowed the small group of shareholders to hear for the
first time from Ms. Austin, a longtime director who was elevated to
interim chairwoman after Chairman and Chief Executive Gregg
Steinhafel resigned last month.
Ms. Austin and John Mulligan, Target's interim CEO, spoke of the
company's challenges during the past year, including the theft of
millions of customer credit-card numbers, a money-losing expansion
into Canada and the inability to attract more shoppers to stores,
and the company's plan to move forward by being more nimble and
willing to test new ideas.
"We need to aggressively move Target forward," Ms. Austin
said.
One longtime shareholder, Aaron Epstein, whose father, Louis,
sold Pickwick bookstore chain to Target's predecessor corporation
in 1968, put Alan Mulally, the soon-to-be-retired CEO of Ford Motor
Co., on his wish list of someone to consider for the next CEO.
"Word has it that he wishes to return to Seattle, but perhaps we
can explain to him that Minnesota has more lakes that are more
beautiful than does Washington state," said Mr. Epstein, one of two
shareholders who spoke during the meeting.
Mr. Epstein offered to send a book, "American Icon," about how
Mr. Mulally turned around Ford, to anyone who presented him a
business card, as well as a gift for taking the time to read the
book: a jar of Target's Market Pantry peaches.
Ford didn't immediately respond to a request for comment from
Mr. Mulally.
Separately, the retailer raised its quarterly dividend by 21% to
52 cents a share. The boost brings the dividend yield for the
company, whose stock has declined 9.5% this year, to about
3.7%.
Write to Paul Ziobro at paul.ziobro@wsj.com
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