Foreign Proxies

General Information

During fiscal year 2013-14, CalSTRS staff voted on 48,951 proposals at 4,892 meetings held for 4,130 companies in our non-domestic equity portfolio.

The proposals covered a variety of topics including:

  • Election of directors.
  • Appointment of company auditors.
  • Ratification of compensation reports.
  • Approval of executive and director compensation plans.
  • Approval of mergers and acquisitions.

Shareholder proposals are not as common outside the U.S. since it is mostly a North American practice, with the vast majority of shareholder proposals submitted to U.S. and Canadian corporations.

Due to the differences in proxies between jurisdictions, we do not have the level of granularity in distinguishing proposals that we have for the United States. CalSTRS changed voting platforms in January 2011, which allows for greater granularity, but we do not have comparable historical data.

2013-14 Proxy Year in Review

The major proxy issues voted on during this past fiscal year are summarized below.

Election of Directors

CalSTRS generally votes in favor of a director unless the proxy statement shows circumstances contrary to policy. Examples of such circumstances include: potential conflict of interest due to other directorships or employment, providing legal or investment banking advice, and poor board meeting attendance (less than 75 percent), or a lack of board independence.

  • Number Voted: 19,542
  • Voted For: 2,891 (15%)
  • Voted Against: 16,651 (85%)

Appointment of Auditors or Authority to Set Auditor’s Fees

CalSTRS will vote in favor of the independent auditors recommended by management unless the auditor provides services that run contrary to CalSTRS policy. Examples of such services are: consulting, information system design and implementation, investment banking support and excessive non-audit fees (greater than 30 percent of the total fees billed).

  • Number Voted: 2,399
  • Voted For: 1,729 (72%)
  • Voted Against: 670 (28%)

Compensation Plans

(Stock Option Plans, Employee Stock Purchase Plans, etc.)

Companies provide a variety of compensation plans for executives, employees and non-employee directors. Many of these plans provide for the issuance of long-term incentives to attract, reward and retain key employees. Compensation plans are evaluated based on the CalSTRS Executive Compensation Model Guidelines.

  • Number Voted:  3,141
  • Voted For: 2,248 (72%)
  • Voted Against: 893 (28%)

Advisory Vote on Compensation/Compensation Policy

These votes provide shareholders the opportunity to ratify the company’s executive compensation or compensation policy. CalSTRS votes on these proposals on a case-by-case basis.

  • Number Voted: 1,666
  • Voted For: 1,312 (79%)
  • Voted Against: 354 (21%)


CalSTRS votes on acquisitions or mergers are done on a case-by-case basis utilizing a total portfolio view.

  • Number Voted: 296
  • Voted For: 282 (95%)
  • Voted Against: 14 (5%)

Corporate Actions/Corporate Governance Issues

These are issues related to spin-offs, incorporation, stock issuance, stock splits and charter and bylaw amendments. CalSTRS votes on these proposals on a case-by-case basis.

  • Number Voted: 13,817
  • Voted For: 11,414 (83%)
  • Voted Against: 2,403 (17%)

Miscellaneous Issues – Management

The most common miscellaneous votes are requests to transact other business or the authorization to carry out legal formalities. These issues are voted on a case-by-case basis.

  • Number Voted: 1,581
  • Voted For: 1,417 (90%)
  • Voted Against: 164 (10%)

Shareholder Proposals

CalSTRS votes on a variety of shareholder proposals. CalSTRS votes on shareholder proposals on a case-by-case basis utilizing the guidelines set by the Teachers’ Retirement Board.

  • Number Voted: 389
  • Voted For: 63 (16%)
  • Voted Against: 326 (84%)

In foreign markets, CalSTRS had a much lower level of support for shareholder proposals. CalSTRS supported 71 percent of shareholder proposals in the United States compared to only 16 percent in the foreign markets. The lower level of support is primarily due to the fact that shareholder proposals in foreign are often overly prescriptive and are mandatory, rather than advisory.

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