NEW YORK, Feb. 22, 2018 /PRNewswire/ -- Neuberger
Berman has been a long-term holder of Nuance Communications, Inc.,
owning shares on behalf of our clients for over five years, and has
engaged with the Board of Directors to help drive changes that
Portfolio Managers believe could lead to long-term value
creation.
In a public letter issued on December 12,
2017, we expressed our concerns as to the process and
transparency of the CEO succession plan, as well as the company's
corporate governance practices.
We note that today, 14 months after CEO Paul Ricci announced his retirement and only a
few weeks before he is about to retire, shareholders have not
received any meaningful update about the CEO succession, and a new
CEO has not been announced. We remain concerned as to the Nuance
Board's ability to execute the announced CEO succession plan, and
the departing CEO's influence on the process.
We believe that the shareholders' right to call a special
meeting – a proposal that appears on the ballot for the upcoming
annual meeting of shareholders – will allow shareholders to act in
case the Board fails to execute on the succession plan and prevent
a delay of the decision for another year.
Moreover, we strongly believe that it is a fundamental
shareholder right to call a special meeting, a belief we have
publicly codified in our Governance and Proxy Voting Guidelines
where we state our general support for shareholder or management
proposals granting these rights.[1] Our view is
supported by organizations like the Council of Institutional
Investors, representing over $25
trillion in assets under management. [2] This
corporate governance best practice has been adopted by a majority
of Russell 1000
companies.[3]
The proposal is especially important for Nuance shareholders,
given the absence of a right to act by written consent or a
majority vote, a history of poison pill adoption, and several years
of poor support for Board proposals at shareholder meetings. We
note that the Board has chosen not to issue a recommendation on
this shareholder proposal, which we see as a positive step in
improving the Company's overall governance profile.
Both Glass Lewis and ISS have voiced support for the proposal,
which ISS noted would "help to increase accountability of the board
and management" and quoted our above-referenced letter as an
indication of concern.[4] We agree with the proxy
advisors' assessment and are hopeful about the potential for
positive change.
For all of those reasons, Neuberger Berman intends to vote FOR
the shareholder proposal.
We hope and expect the proposal will receive significant support
from shareholders, and that the Board will follow the proponent's
statement and promptly adopt the right unilaterally. We appreciate
the changes Nuance has already implemented, and look forward to a
continuing dialogue with the Board of Directors.
For context and information on past Neuberger Berman actions
regarding Nuance, please click here.
Nuance
Communications (NUAN) Corporate Governance
Provisions
|
http://investors.nuance.com/corporate-governance
|
|
|
|
|
|
Incorporated
In
|
Poison
Pill
|
|
|
|
|
Delaware
|
Expired
|
|
|
|
|
|
NUAN-US
|
Supermajority
to
|
% Firms with
Provision
|
Board
|
Y/N
|
Source
|
Amend/Repeal (%
required)
|
SIC Grp
73
|
Russell
1000
|
Majority Vote
Standard to Elect
|
No
|
Bylaws
|
N/A
|
34.79
|
75.98
|
Director Resignation
Policy
|
No
|
N/A
|
N/A
|
38.93
|
79.91
|
Classified
Board
|
No
|
State
Default
|
No
|
54.26
|
24.35
|
Board Can
Increase/Decrease Board Size
|
Yes
|
Charter/Bylaws
|
No
|
100.00
|
99.78
|
Directors Removed
Only for Cause
|
No
|
Bylaws
|
No
|
52.07
|
35.02
|
Supermajority Vote to
Remove Directors (% required)
|
No
|
Bylaws
|
No
|
31.63
|
24.69
|
Supermajority Only if
Removal Without Cause (% required)
|
No
|
Bylaws
|
No
|
2.68
|
1.57
|
Board Fills All
Vacant Seats
|
Yes
|
Bylaws
|
No
|
82.73
|
80.25
|
Voting
|
|
|
|
|
|
Proxy Access (%
required)
|
Yes
|
Bylaws (3)
|
No
|
11.44
|
44.33
|
Cumulative
Voting
|
No
|
State
Default
|
No
|
2.43
|
3.03
|
Action by Written
Consent
|
No
|
Charter/Bylaws
|
No
|
28.71
|
28.62
|
Unanimous Written
Consent
|
No
|
Charter/Bylaws
|
No
|
13.38
|
28.28
|
Shareholders Can Call
Special Meetings (% required)
|
No
|
Bylaws
|
No
|
37.47
|
56.12
|
Supermajority for
Mergers (% required)
|
No
|
State
Default
|
No
|
8.76
|
20.31
|
Supermajority Does
Not Apply to Board Approved Mergers
|
No
|
State
Default
|
No
|
3.16
|
6.40
|
Supermajority to
Amend All/Certain Charter Provisions (% reqd)
|
No
|
State
Default
|
No
|
58.64
|
48.60
|
Supermajority to
Amend All/Certain Bylaw Provisions (% reqd)
|
No
|
State
Default
|
No
|
41.85
|
24.02
|
Advance Notice for
Proposals (minimum days)
|
Yes
|
Bylaws
(90)
|
No
|
48.18
|
29.41
|
Advance Notice for
Nominations (minimum days)
|
Yes
|
Bylaws
(90)
|
No
|
47.93
|
29.41
|
Derivative Disclosure
in Advance Notice Requirements
|
No
|
N/A
|
No
|
58.39
|
71.16
|
Other
Provisions
|
|
|
|
|
|
Blank Check Preferred
Stock
|
Yes
|
Charter
|
No
|
96.11
|
95.85
|
Board Can Amend
Bylaws w/out Shareholder Approval
|
Yes
|
Charter/Bylaws
|
No
|
98.54
|
98.65
|
Exclusive
Forum
|
No
|
N/A
|
No
|
42.09
|
43.55
|
Fair Price Provision
(trigger %) (company sponsored)
|
No
|
N/A
|
No
|
4.14
|
11.90
|
Expanded Constituency
Provision (company sponsored)
|
No
|
N/A
|
No
|
4.87
|
7.97
|
Anti-Greenmail
Provision (company sponsored)
|
No
|
N/A
|
No
|
0.49
|
2.47
|
Poison Pill In
Force
|
No
|
N/A
|
N/A
|
5.84
|
2.24
|
Anti-Poison Pill
Provision
|
No
|
N/A
|
No
|
0.24
|
1.46
|
Poison Pill
Policy
|
No
|
N/A
|
N/A
|
1.22
|
8.64
|
Unequal Voting (Dual
Class)
|
No
|
N/A
|
No
|
11.92
|
11.78
|
Ownership
Limit
|
No
|
N/A
|
N/A
|
3.41
|
14.59
|
Other Defense
Text
|
N/A
|
|
|
|
|
|
|
Source:
Factset
|
|
|
|
|
|
About Neuberger Berman
Neuberger Berman, founded in 1939, is a private, independent,
employee-owned investment manager. The firm manages a range of
strategies—including equity, fixed income, quantitative and
multi-asset class, private equity and hedge funds—on behalf of
institutions, advisors and individual investors globally. With
offices in 20 countries, Neuberger Berman's team is approximately
1,900 professionals. For five consecutive years, the company has
been named to Pensions & Investments Best Places to Work
in Money Management survey (among those with 1,000 employees or
more). Tenured, stable and long-term in focus, the firm fosters an
investment culture of fundamental research and independent
thinking. It manages $295 billion in
client assets as of December 31,
2017. For more information, please visit our website at
www.nb.com.
All information is as of December 31,
2017 unless otherwise indicated and is subject to change
without notice. Firm data, including employee and assets under
management figures, reflects collective data for the various
affiliated investment advisers that are subsidiaries of Neuberger
Berman Group LLC. Firm history/timeline includes the history of all
firm subsidiaries, including predecessor entities and acquisitions.
Links to third party websites are furnished for convenience
purposes only. The inclusion of such links does not imply any
endorsement, approval, investigation, verification or monitoring by
Neuberger Berman of any content or information contained within or
accessible from the linked sites.
This material is being issued on a limited basis through various
global subsidiaries and affiliates of Neuberger Berman Group LLC.
Please visit www.nb.com/disclosure-global-communications for the
specific entities and jurisdictional limitations and
restrictions.
The "Neuberger Berman" name and logo are registered service
marks of Neuberger Berman Group LLC.
© 2018 Neuberger Berman Group LLC.
All rights reserved.
[1]
https://www.nb.com/_layouts/www/ap/downloadasset.aspx?asset=documents/public/en-us/nb_proxy_policy_guidelines.pdf
[2] http://www.cii.org/corp_gov_policies
[3] See Attached Factset analysis
[4] ISS Proxy Analysis & Benchmark Policy Voting
Recommendations
Media Contact: Alex Samuelson,
212.476.5392, Alexander.Samuelson@NB.com
View original content with
multimedia:http://www.prnewswire.com/news-releases/neuberger-berman-to-vote-for-shareholder-proposal-regarding-right-to-call-a-special-meeting-at-nuance-communications-inc--nuan-300602902.html
SOURCE Neuberger Berman