Just a few days ahead of the biggest proxy battle the corporate industry will ever witness, Procter & Gamble Co.’s (P&G) chief executive David Taylor has urged investors to not offer Trian Partners’ CEO and founding partner Nelson Peltz a seat on the company’s board.
Taylor, along with P&G’s chief financial officer Jon Moeller, and board member Meg Whitman attended a question-and-answer session, where they answered some of the shareholders’ questions regarding Trian Partners’ proposal of adding Peltz to its board.
The executives stated that the company is on the right transformation route and it could only stick to the path if investors voted against Nelson Peltz’s bid to be a part of the board.
Taylor also argued that Peltz becoming a board member would only disrupt P&G’s progress as he would seek to fundamentally change the soul of the company.
For this reason, Taylor has urged P&G employees, retirees, and alumni to let their voice count and be heard. He asked them to vote blue as well.
Voting blue means that the consumer products maker would keep its current 11 members of the board, while a white proxy would result to Peltz’s appointment as member of the board.
Peltz has been aiming for a position on P&G’s board for weeks now and the proxy battle between him, and the US-based consumer goods group is about to come to an end on October 10, where the company’s shareholders will be casting their votes on whether Peltz should be a board member or not.
P&G and Nelson Peltz Locked in a Public Dispute
Peltz, who has acquired $3.5 billion worth of P&G stake through his hedge fund firm Trian Partners in February, has been in a public dispute with the company since June concerning its future and has long been pushing to join the board.
He has expressed his disapproval over P&G’s culture, saying that it was limited and has failed to acquire small, mid-sized, and local brands that could boost its market share.
Peltz proved his point by publishing a 94-page white paper last month, underlining P&G’s returns to shareholders have fallen short and its stifling system has put its businesses at a disadvantage, therefore giving the company a hard time from the lack of improvement.
Moreover, Peltz believed that its board, which is mainly composed of chairmen as well as chief executives of other companies, is divided with P&G’s day-to-day affairs.
Determined to be a part of P&G’s board, Peltz has proposed major changes for the corporation, including a plan to restructure its businesses into three global units. If he was to be elected, Peltz vowed to do just this.
Taylor said that he respects Peltz as an investor but they do not believed that appointing him to the board is the right decision at the moment, adding that they have to remain focused and balanced.
Former P&G CEO A.G. Lafley also agrees with the current chief executive, saying that Peltz is purely mistaken with regards to his opinion about the company.
The three executives rejected Peltz’s allegations, noting that P&G’s shake-up has lessened complications and that their board members are keeping in touch on a regular basis with the management.