DEFA14A: Veeva Systems Defends Director Nominees Amid ISS Opposition

Veeva Systems urges shareholders to re-elect directors Paul Sekhri and Matt Wallach, despite ISS recommendations against their re-election.

Summary

• Veeva Systems has issued a supplement to its proxy statement addressing Institutional Shareholder Services (ISS) recommendations against the re-election of directors Paul Sekhri and Matt Wallach.
• The board of directors strongly disagrees with ISS's recommendations and supports the re-election of both nominees.
• ISS raised concerns about Paul Sekhri's overboarding and Matt Wallach's independence.
• Veeva's board argues that Mr. Sekhri's experience in the life sciences industry and contributions to the Nominating and Governance Committee make him a valuable member.
• The board also emphasizes that Mr. Sekhri's presence contributes to the diversity of viewpoints on the board.
• Regarding Mr. Wallach, Veeva asserts that he is an independent director under NYSE listing standards, despite being a co-founder who left employment in June 2019.
• The board highlights Mr. Wallach's deep knowledge of Veeva, life sciences technology expertise, and customer relationships as crucial for strategy, risk management, and governance.
• Veeva urges shareholders to vote for all director nominees.

Sentiment

Score: 7

Explanation: The sentiment is neutral to slightly positive. While there's a disagreement with ISS, Veeva is actively defending its director nominees and highlighting their value to the company.

Positives

• The board believes Paul Sekhri's experience in the life sciences industry and contributions to the Nominating and Governance Committee are invaluable.
• The board also emphasizes that Mr. Sekhri's presence contributes to the diversity of viewpoints on the board.
• The board highlights Mr. Wallach's deep knowledge of Veeva, life sciences technology expertise, and customer relationships as crucial for strategy, risk management, and governance.

Negatives

• Institutional Shareholder Services (ISS) has recommended against the re-election of directors Paul Sekhri and Matt Wallach.
• ISS raised concerns about Paul Sekhri's overboarding.
• ISS questions Matt Wallach's independence.

Risks

• There is a risk that shareholders may follow ISS's recommendations and vote against the re-election of Paul Sekhri and Matt Wallach.
• Failure to re-elect these directors could potentially impact the board's composition and decision-making processes.

Future Outlook

Veeva hopes that ISS will reconsider its recommendations and that shareholders will vote for Mr. Sekhri and Mr. Wallach.

Management Comments

• The Board, when undertaking its annual review of our overboarding policy, determined that Mr. Sekhris continued service on the Board is appropriate and in the best interest of the Company.
• Contrary to ISSs position, Mr. Wallach is in fact an independent director under the NYSEs listing standards, including for the purpose of serving on our Nominating and Governance Committee.

Industry Context

This announcement highlights the increasing scrutiny and influence of proxy advisory firms like ISS on corporate governance matters and shareholder voting decisions.

Comparison to Industry Standards

• ISS's overboarding policy typically flags directors serving on more than a certain number of boards, often three or four, depending on the size and complexity of the companies.
• The definition of 'independence' for board members is generally aligned with NYSE listing standards, which require a lack of material relationships with the company.
• Companies like Veeva often benchmark their governance practices against peers in the technology and life sciences industries.

Stakeholder Impact

• The outcome of the director elections could impact shareholder value and the company's strategic direction.
• The board's composition affects its ability to effectively oversee management and protect stakeholder interests.

Next Steps

• Shareholders will vote on the election of directors at the 2024 Annual Meeting on June 12, 2024.

Key Dates

Keywords

Veeva Systems, Director Election, Proxy Statement, ISS, Paul Sekhri, Matt Wallach, Board of Directors, Shareholders, Governance, Overboarding, Independence