Ford Family And Other Family Business Directors Dominate Ford Board Of Directors

| About: Ford Motor (F)
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Results of Annual Shareholder Meeting, Election of Directors Form 8-k.

Vote shows Mark Fields strong support.

Edsel Ford II Received the largest share of no votes.

Ford Board has several members with family business experience.

Ford (NYSE:F) Annual Shareholder Meeting Analysis

Ford Motor Co. held their virtual annual shareholder meeting on May 11th, 2017. During the meeting, an election of members to the Board of Directors was held.

Voting Results

Ford has two Ford family members on its board of directors; William Clay Ford Jr. and Edsel Ford II. Edsel Ford II is Henry Ford's great grandson. He received 229,076,396 no votes, twice as many no votes as the next highest board member. Edsel Ford II has worked in various positions at Ford.

William Clay Ford Jr. (Edsel's cousin) was shown strong support with only 60,198,313 no votes compared with 4,703,225,077 yes votes.

The yes votes for all candidates ranged from a low of 4,533,891,266 (for Edsel) to a high of 4,703,968,316 for John S. Weinberg.

Despite the recent doubts regarding his future at Ford, Mark Fields was shown massive support with only 57,302,679 no votes. Out of the entire slate of 14 directors, Fields received the fourth lowest amount of no votes. This shows broad support for Fields.

I will do more research to see why such a large amount of no votes for Edsel Ford II were cast, but there was an arrest in 2016 that may have been part of the reason. In a family firm, one of the main responsibilities of family members is to not bring embarrassment on the family and cause harm or shame to its social standing, and the legacy of its founder.

Ford Board Packed with Family Business Ties

Interestingly, the Ford Board has ties with members of other family controlled firms: Jon M. Huntsman Jr. is a member of the Ford Board of Directors. He is the former Governor of Utah, and former CEO of family owned Huntsman Corporation (NYSE:HUN). He knows the advantages of a family firm such as; the long term viewpoint, the importance of family legacy (see my recent article, Family Controlled Ford Makes Long Term Decisions here).

Director John S. Weinberg recently retired from Goldman Sachs which his family ran for many years. John C. Lechleiter is Chairman of Eli Lilly (NYSE:LLY) a formerly family owned company, and whose largest shareholder is the Eli Lilly Foundation which was created by the Lilly family's charitable giving. So, he is familiar in dealing with a very powerful voting block. Director Kimberly A. Casiano was President of Casiano and Associates a family firm started by her parents.

What this Means for Investors

With two Ford family members on the board who control 40% of the voting rights of the shares, the addition of fellow family business owners, and those who are knowledgeable of family control, this makes the family control of Ford even stronger.

As an example, at the shareholder meeting a proposal to make all shares of stock to be of equal weighting was voted down. This would have reduced the vote total of the Ford family's "supershares" to be equal to that of their stock ownership. The Ford family has a very small ownership share (1-2%) of the corporate stock. However, their special shares are worth many times more in voting rights per share than common stock is. Through these supershares, the family controls 40% of the voting rights. This is out of proportion to their ownership share.

With the amount of members of the Board of Directors who have personal family business experience and knowledge, the board may not be likely to push for changes in this matter. Those directors with family business experience may show empathy with the family and not go against the family's wishes.

The purpose of having outside directors on the board is to have a different and fresh perspective. This increases diverse views and aids decision making. Having a large number of "family friendly" directors could prevent meaningful discussion on sensitive issues important to the Ford family, resulting in insular decision making, and possible management or CEO entrenchment.

Voting Results for Proposal to have All Shares be of Equal Weight

From Form 8-k

Proposal Five: Relating to Consideration of a Recapitalization Plan to Provide that All of the Company's Outstanding Stock Have One Vote Per Share.

A proposal relating to consideration of a recapitalization plan to provide that all of the Company's outstanding stock have one vote per share was rejected with the votes shown:




Broker Non-Votes





Opposing View

The data is mixed on family firm performance. Financial performance under the founder of a family firm is usually quite good. Data shows the second and third generation CEO's have not enjoyed as good of financial performance as their family predecessor. The best managed family firms have a family member on the board who represents the family's interests, and the company is managed professionally with experienced and professional CEO's and boards of directors.

Miller and Le Bretton-Miller (2005) site numerous instances of family firms financially outperforming non family firms.


Miller, D., & Le Bretton-Miller, I, (2005). Managing for the long run: Lessons in competitive advantage from great family businesses. Boston, MA. Harvard Business School Publishing

Election of Directors Voting Results

(See the chart from Form 8-k below)

Item 5.07. Submission of Matters to a Vote of Security Holders .

On May 11, 2017, our Annual Meeting of Shareholders was held. The matters voted upon and the results of the vote were as follows:

Proposal One: Election of Directors.

Nominee For Against Abstain Broker Non-Votes
Stephen G. Butler 4,664,088,721 93,368,731 15,897,272 1,194,295,436
Kimberly A. Casiano 4,662,607,162 95,462,812 15,284,750 1,194,295,436
Anthony F. Earley, Jr. 4,693,866,906 64,354,896 15,132,922 1,194,295,436
Mark Fields 4,703,831,590 57,302,679 12,220,455 1,194,295,436
Edsel B. Ford II 4,533,891,266 229,076,396 10,387,062 1,194,295,436
William Clay Ford, Jr. 4,703,225,077 60,198,313 9,931,334 1,194,295,436
William W. Helman IV 4,706,878,075 50,064,580 16,412,069 1,194,295,436
Jon M. Huntsman, Jr. 4,678,547,984 79,935,070 14,871,670 1,194,295,436
William E. Kennard 4,691,479,211 65,388,305 16,487,208 1,194,295,436
John C. Lechleiter 4,693,700,487 62,898,575 16,755,662 1,194,295,436
Ellen R. Marram 4,634,283,653 123,926,714 15,144,357 1,194,295,436
John L. Thornton 4,658,464,915 99,535,477 15,354,332 1,194,295,436
Lynn M. Vojvodich 4,719,606,454 37,835,398 15,912,872 1,194,295,436
John S. Weinberg 4,703,968,316 53,469,862 15,916,546


Disclosure: I am/we are long F.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.