A Win for Retirees & Shareowners

Association Chairman Tommy Steed, with our Chief Financial Officer Frank Bruzek, made what turned out to be a victorious trip to Salt Lake City for this year’s Verizon Annual Meeting as company leadership proactively adopted a bylaw change inspired by your Association’s proxy proposal to limit Golden Parachutes (Item #8).

Our 2023 “Golden Parachute” proposal recommended that shareholders get to pre-approve any new and renewed senior executive severance or termination packages that include payments exceeding 2.99X base salary plus target short-term bonus.

A nearly identical proposal we led last year garnered 44%, leaving company leadership so uncomfortable that they acted and changed the bylaw in advance of the vote.

To illustrate why it is needed, CEO Hans Vesberg could receive $31.6 million, or more than six (6) times his 2022 base salary plus a short-term bonus, upon termination, following ANY change in company control.

The change took place after our proxy was received in early December 2022, but before the company sent the shareowner ballot on March 27, 2023.

At the meeting, Chairman Steed congratulated Bill Horton, Deputy General Counsel at Verizon, for proactively implementing that bylaw change brought about by our proposal. With this shareholder concern over the current era Golden Parachutes addressed in the bylaws – at least for now – positive change was brought about.

Your Association submitted two important proposals this year, the second of which was designed to strengthen the Senior Executive Clawback policy (Item #7). This proposal, which received the endorsement of the influential investor advisory service, Institutional Shareholder Services (ISS), was the highest vote getter of all proposals, with 37.9%.

BellTel leaders continue to believe that the current company policy is simply too vague and lenient on corporate malfeasance. Current policy calls for cancellation or recoupment of cash and equity compensation only when an executive engages only in “willful misconduct” resulting in a material restatement of VZ’s financial results.

BellTel has sought to make this standard more stringent, with Steed saying, “The current executive clawback reflects an absolute double standard that should not be permitted, given that regular employees can be disciplined or fired for failing to execute their duties.”

The 2023 proxy season is another success in our long running shareowner advocacy efforts, now resulting in 13 changes to enhance corporate bylaws because of the Association of BellTel Retirees’ aggressive advocacy.

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In late 2022, when all proxy proposals must be finalized and submitted, our team set out to initiate our first such campaign at AT&T.

A proxy was submitted by longtime BellTel board member and Chief Financial Officer, Robert Gaglione, nicknamed the “Golden Coffin.” It called for a new policy ensuring the AT&T board obtains shareholder ratification for any future agreements that oblige the company to make payments or awards to the family or estate of a senior executive who dies.

Beneficiaries of such Golden Coffin agreements are the same AT&T executives who reduced life insurance policies of its retirees.

AT&T sent an army of SEC attorneys to keep this and three other proposals off of the 2023 shareholder ballot.

Our Golden Coffin proposal was one of the four different shareowner proposals the SEC selected to omit from this year’s AT&T proxy.

Despite being removed from this year’s proxy, BellTel’s commitment to shareholder advocacy has not diminished. We plan to be back next year.