Target shareholders on Wednesday rejected an investor proposal seeking to separate the roles of board chair and executive leadership, according to two sources with direct knowledge of the vote. The defeat of the proposal means former CEO Brian Cornell will remain in the executive chair position, despite investor calls for a more independent board leadership voice.
Also failing to pass at the retailer's annual meeting were shareholder proposals that would have required Target to publish reports on pesticides used in private-label products and to outline efforts to reduce microfiber emissions from its merchandise, the sources said. While preliminary vote totals were not publicly disclosed, the sources added that all director nominees were elected.
Target declined to comment on the voting outcome.
The governance debate comes amid a broader performance challenge for the company. Target has struggled to keep pace with competitors such as Walmart and Costco as inflation-weary consumers have shifted toward lower-priced options, pressure that has weighed on the company's sales and margins. The retailer has lost roughly half of its market value since 2021, raising investor questions about strategy and execution.
Company results have shown early signs of a recovery, yet Target has cautioned that a difficult macroeconomic environment could continue to weigh on consumer demand. Concerns about governance were heightened after the company transitioned long-time CEO Brian Cornell to the role of executive chairman. In that capacity, Cornell retains operational oversight over his successor, Michael Fiddelke.
Under Cornell's leadership, Target faced merchandising missteps and made strategic decisions such as stepping back from certain diversity, equity and inclusion initiatives, moves that have been cited as factors that hurt sales and customer loyalty. Since Fiddelke assumed the CEO role in February, management has identified inventory availability and price competitiveness as priorities.
To address those priorities, Fiddelke is directing $2 billion in spending this year to improve in-stock positions and sharpen pricing as Target seeks to better compete with aggressive discounting from rivals including Walmart, Amazon and off-price chains. The company's recent actions aim to restore customer traffic and margin stability, but the outcome remains subject to prevailing macroeconomic pressures.
Context
- The board leadership proposal was rejected, allowing Brian Cornell to remain executive chair with operational oversight.
- Shareholder proposals on pesticide disclosures for private-label products and microfiber emission reductions also did not pass.
- All director nominees were elected, and Target did not provide a public comment on the vote.