Target investors reject proposal for independent board chair, sources say
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FILE PHOTO: A person walks by a Target store in Manhattan, New York City, U.S., November 22, 2021. REUTERS/Andrew Kelly/File Photo
(Corrects last paragraph to note that Target's $2 billion investment was additional to a previous $4 billion investment)
By Nicholas P. Brown and Juveria Tabassum
June 10 (Reuters) - Target shareholders on Wednesday rejected an investor proposal to separate the roles of board chair and executive leadership, according to two sources with direct knowledge of the vote.
The result allows former CEO Brian Cornell to remain as executive chair despite mounting pressure from investors for a more independent voice.
A shareholder proposal calling for publishing reports on pesticides in private-label products and efforts to reduce microfiber emissions from its products also failed to pass at Target's annual general meeting, the people said.
While preliminary voting numbers were not revealed yet, all director nominees were elected, they added.
Target declined to comment.
Target has struggled to keep pace with rivals such as Walmart and Costco as inflation-weary consumers gravitate toward lower prices, weighing on the company's sales and margins.
The retailer has lost roughly half of its market value since 2021, raising concerns about strategy and execution.
Recent results showed signs of recovery, but Target has cautioned that a tough macroeconomic environment could continue to pressure demand.
Concerns over governance intensified after Target transitioned long-time CEO Brian Cornell to executive chairman, a position that has operational oversight over successor Michael Fiddelke, who took the helm in February.
Under Cornell, Target struggled with merchandising missteps, and decisions such as backing away from diversity, equity and inclusion initiatives (DEI), which hurt sales and customer loyalty.
Fiddelke said in March that Target will invest an additional $2 billion this year - on top of a previously-announced $4 billion - to ensure well-stocked merchandise and to sharpen prices to better compete with aggressive discounting by Walmart, Amazon and off-price chains.
(Reporting by Sanskriti Shekhar in Bengaluru; Editing by Arun Koyyur and Christopher Cushing)
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