McKesson Corp. (MCK) will face some opposition at its annual shareholder meeting this Wednesday, July 26 from an unconventional activist investor -- a labor union.
The International Brotherhood of Teamsters not only plans to attend the shareholder meeting, but will also hold a protest outside the meeting's doors with the intent to shed some light on McKesson's position in the opioid crisis and "demand accountability for its role in fueling the epidemic", according to the union's most recent press release. Protesters will hold signs reading "McKesson CEO Makes a Killing as America Drowns in Opioids."
"Inside, we'll be pressing the company, outside there will be a protest," said Michael Pryce-Jones, Senior Governance Analyst at Teamsters. "We feel that this is a corporate governance issue that has impacted the opioid crisis."
The union, a long-term shareholder of McKesson, is calling for reform in the company's governance and executive pay system. Earlier in July, Teamsters sent a letter to McKesson shareholders urging for a vote in favor of the union's independent chair proposal and against the company's executive pay proposal. The independent chair proposal would separate the chairman position from the CEO position whereas the executive pay proposal would re-structure the company's compensation plan. The Teamsters said pay plan would not sufficiently link executive pay to performance.
The union has some high-profile allies in the campaign, proxy advisory services Institutional Shareholder Services (ISS) and Glass, Lewis & Co. both reiterated Teamsters' sentiment in their own recommendations. ISS believes that the company's compliance program "should be closely monitored" and also believe that shareholders would "benefit from stronger independent board oversight." Glass Lewis issued McKesson a "D" grade in the company's pay-for-performance model.