Good day, and welcome to the Salesforce 2024 Annual Meeting of Stockholders. I will now turn it over to Salesforce.
All right. Hello, everyone, and I'm Marc Benioff, Chairman and CEO of Salesforce, and I hereby call this meeting to order on behalf of Salesforce's board and management. It's absolutely our pleasure to welcome you and to express our appreciation for your participation in our annual meeting. I'm going to act as chair of the meeting, and Sabastian Niles, our President and Chief Legal Officer, is acting as secretary. I'm pleased to introduce the other directors joining us today, including Laura Alber, Craig Conway, Arnold Donald, Parker Harris, Neelie Kroes, Sachin Mehra, Mason Morfit, Oscar Munoz, John Roos, Robin Washington, and Maynard Webb. Also present are several members of management, our Inspector of Elections, and a representative of Ernst & Young, our independent auditor. Sabastian will now cover the procedural and voting matters.
Thank you, Marc. This meeting will be conducted in accordance with the agenda and rules of procedure, which are posted on the meeting website for stockholders. To conduct an orderly and productive meeting, we do ask participants to abide by these rules, and if you'd like to submit a question, you may do so by following the instructions on the meeting website. Please note that during the business portion of the meeting, we will present the proposals and have an opportunity to address related questions on them. Afterwards, we will keep the line open to address other questions that relate to the company's business and are of general interest to stockholders. Now, as to the procedural matters, first, our proxy statement materials were made available beginning on May 16th, to stockholders of record as of the record date, which was May 1st.
Our Inspector of Elections has confirmed that at least a majority of the Company's issued and outstanding shares entitled to vote are present or represented by proxy at today's shareholder meeting, and therefore, a quorum is deemed present, and the business of this meeting shall proceed. The polls opened at the beginning of the meeting at 11:02 A.M. Pacific Time, and the polls will close on all matters immediately after the presentation and discussion of today's proposals. Now, many of you have already voted by proxy, and your shares will be voted accordingly. You do not need to vote again now at the meeting, unless you wish to change your vote or you requested a legal proxy. If you would like to vote now or revoke a prior vote, please follow the instructions on the meeting website before the polls close.
The first item of business is the election of directors. As set forth in the proxy statement, the Board has nominated the following 13 individuals to be elected: Marc Benioff, Laura Alber, Craig Conway, Arnold Donald, Parker Harris, Neelie Kroes, Sachin Mehra, Mason Morfit, Oscar Munoz, John Roos, Robin Washington, Maynard Webb, and Susan Wojcicki. The Board recommends a vote for each nominee. I will now introduce proposals two through five. The Board recommends a vote for each of these proposals. Proposal two is the amendment of our Certificate of Incorporation to provide for officer exculpation. Proposal three is the amendment and restatement of our 2013 Equity Incentive Plan to increase the number of shares reserved for issuance and extend the plan term. Proposal four is the ratification of the appointment of Ernst & Young as our independent auditor.
Proposal five is an advisory vote to approve the compensation of our named executive officers. Now, the next set of proposals were submitted by stockholders and will be introduced by a proponent or representative of the proposal. We ask that all speakers observe appropriate decorum, engage in civil discourse, restrict their comments to the topic of their proposal, and please limit their presentation to three minutes, all as outlined in the rules of procedure. We reserve the right to halt remarks not consistent with these rules of procedure, but hope to not have to do that today. Our first stockholder proposal is Proposal six, regarding an independent chair of the board. Operator, please open the line for this proposal to be introduced.
For the second year in a row, left-wing activist shareholders who bring voluminous proposals against all the other big tech companies have left Salesforce alone. Liberal investors who routinely attack large tech corporations are going easy on Marc Benioff and Salesforce. It's easy to understand why. He funds their agendas, and they leave him alone. That's why we've seen Salesforce's home of San Francisco turn into a disgraceful crime and homeless-ridden hellhole, complete with a poop map, thanks to Mr. Benioff's political policy beliefs that he has advocated through his Salesforce leadership. The only times we see the city by the Bay cleaned up are when a Chinese dictator shows up to give a speech for big-time corporate executives or when Mr. Benioff hosts his annual Dreamforce conference. Even Gavin Newsom admits this.
It was only a year ago that several big-dollar activist investors pressured Mr. Benioff to cut costs and improve efficiencies at Salesforce. Mr. Benioff squeaked by with some changes in concessions, and stock performance temporarily improved, so the activist investors backed off. But now it's a year later, and Mr. Benioff has just offered up another dismal earnings report along with poor guidance, and Salesforce's stock price immediately plummeted. I wonder what those shareholder activists think now. Once again, our warnings about Mr. Benioff's mismanagement and poor priorities fell on deaf ears, and shareholders pay the price. When are voting institutional shareholders finally going to get it? This is par for the course for Mr. Benioff. For years, he tried to pull off a co-CEO charade at Salesforce. Yet time after time, his alleged co-CEOs left. Clearly, he's someone that won't relinquish any power because his ego won't let him.
No one can work with him at the top, and all we get is chaos and a rollercoaster stock performance as a result. He has the same problem that Howard Schultz did in letting go at Starbucks and that Bob Iger's having at Disney. They can't help themselves, and neither can Mr. Benioff. As a result, their companies and investors suffer. Finally, I want to address the falsehood told by the Salesforce board in the proxy statement, accusing my organization of refusing to discuss our proposal with the company. We offered at least three dates to meet to discuss the proposal when we submitted it to Salesforce within the 30-day requirement under SEC rules. But instead of engaging us on our offered times or suggesting alternatives within the SEC 30-day window, the company ignored the SEC's rules and waited almost 3 months before they asked us to meet.
It is wrong for companies to refuse to abide by SEC guidelines and then to lie about it to try to make proponents look bad. Please vote for Proposal Six.
Thank you. The board recommends a vote against Proposal Six for the reasons set forth in our proxy statement. We will now move to Proposal Seven regarding stockholder approval of certain executive severance arrangements. Operator, please open the line for this proposal, to be introduced. Mr. Chevedden, your line is now open.
Hello, this is John Chevedden. Proposal Seven, this is the correct title for Proposal Seven. It's, shareholder opportunity to vote on excessive golden parachutes. Shareholders request that the board adopt a policy to seek shareholder approval of senior managers' new or renewed pay packages that provide for golden parachute payments with an estimated value exceeding 2.99 times the sum of the executive's base salary plus target short-term bonus. This proposal only applies to named executive officers. The board shall retain the option to seek shareholder approval at an annual meeting after material terms of golden parachutes are agreed upon. Generous performance-based pay can sometimes be justified, but shareholder ratification of golden parachutes better aligns management pay with shareholder interest. This proposal is especially relevant because there are absolutely no limits on equity golden parachutes at Salesforce.
It's totally inconsistent that Salesforce believes there needs to be limits on cash golden parachutes, and then Salesforce has absolutely no limits on equity golden parachutes. Excessive golden parachutes can simply be switched from cash to equity to avoid shareholder accountability. In a statement next to this proposal, the Salesforce board of directors says that it is in favor of shareholders expressing their views on excessive golden parachutes as long as shareholders have no, absolutely no power to express their views on excessive golden parachutes in a vote at the annual shareholder meeting. This proposal is relevant even if there are current golden parachute limits. A limit on golden parachutes is like a speed limit. A speed limit by itself does not guarantee that the speed limit will never be exceeded. Like this proposal, the rules associated with a speed limit provide consequences if the limit is exceeded.
With this proposal, the consequences are a non-binding shareholder vote is required for unreasonably high golden parachutes. This proposal places no limit on long-term equity pay or any other type pay. This proposal, thus, has no impact on the ability to attract executive talent or discouraging the use of long-term equity pay because it places no limit on golden parachutes. It simply requires that extra large golden parachutes be subject to non-binding shareholder vote at a shareholder meeting already scheduled for other matters. This proposal is relevant because the annual say on executive pay vote does not have a separate section for approving or rejecting golden parachutes. Please vote yes. Shareholder opportunity to vote on excessive golden parachutes, Proposal Seven.
Thank you. The board recommends a vote against Proposal Seven for the reasons set forth in our proxy statement. We will now move to Proposal eight, regarding a report on viewpoint restriction risks. Operator, please open the line for this proposal to be introduced. Mr. Peck, your line is now open.
This proposal requests a non-discrimination report, evaluating how the company's policies and practices impact customer speech rights based on their ideological, political, or religious views, and the risks that those impacts present to the company's business. The proposal is necessary because currently, the board, the company's board policies, public statements, charitable giving, and ESG commitments are ideologically homogenous, heavily biased to the left, and intolerant of opinions and beliefs right of center. The company's ethical use policy for its customers clearly states that it doesn't permit the use of Salesforce technology to, quote, unquote, "spread disinformation." But who determines what's disinformation and what's not? And how could such a politically biased company be tasked with doing this fairly?
Salesforce is now a place, for example, where most employees are too scared to admit out loud, for fear of being fired, that they know full well that a man can't become a woman, or that hiring and promoting should be based on merit and not on skin color. When that kind of company, one which already has unwritten rules to police the speech of its workforce, now has a written policy to openly police the speech of its customers, you can guarantee that it won't be applied in an objective and politically neutral manner. As a publicly traded company, Salesforce cannot police the speech of its customers based on, on political or ideological grounds. It must respect and uphold the First Amendment speech rights and religious freedoms of its ideologically diverse customer base. But moreover, from a business perspective alone, it's stupid.
Companies jeopardize their financial sustainability when they wade into social and political matters for no financial benefit, but with all of the financial risk, risks that insulting your own customer base carries. When corporations insert themselves in the middle of heated societal debates by taking public stances, funding activism on divisive issues, or in this case, censoring speech on culturally important issues, issues that are meant to be debated amongst citizens in the halls of Congress, not at corporations or in meetings like this, but unfortunately, unfortunately, we have to now, then they violate their fiduciary duty twice. Once for using shareholder assets to push an agenda that those same shareholders are deeply divided about, and once for risking the value of shareholder assets by doing just that. Because time and again, and particularly over the last two years, the market has punished companies for being overtly political.
Customers simply don't want to be preached on politics or censored for their views, especially in a radically one-sided fashion. They just want to use the products and services they're paying for. We're not asking the company to adopt right-wing or conservative views or to censor left-wing ones. Just pointing out that a company has a legal obligation not to promote left-wing views or censor right-wing ones, that a company has to be neutral. Simply put, in order for the company to sustain itself financially, it has to and should be neutral. At a minimum, we're recommending that the company thoroughly and fairly evaluate the risks of its currently politically biased policies, specifically related to the censorship of its customers, which is all our proposal requests.
Thank you. The board recommends a vote against this proposal for the reasons set forth in our proxy statement. I'll pause now for any questions specifically regarding the ballot items. As a reminder, we will close the polls immediately after addressing any such questions. Remember, we will hold a general Q&A question session after the business portion of this meeting. Thank you. We've now covered all of the business properly brought before the stockholders today. I now declare the polls for each proposal to be closed at approximately 11:17 A.M. Pacific Time. Based on preliminary results for the proposals, the Inspector of Elections has confirmed that all 13 nominees have been reelected as directors of the company. Proposals two, three, and four have been approved.
The Inspector of Elections has also confirmed that based on preliminary voting results, Proposals five, six, seven, and eight were not approved. The Inspector of Elections will provide a final voting report, which will be included in the minutes of the meeting, and the final voting results will also be filed with the SEC. Salesforce looks forward to continued engagement with our shareholders as part of our ongoing stockholder engagement program.
Well, thank you, Sabastian, and I'd like to also thank all of the speakers on today's program and all of our shareholders for their comments. We're so grateful to you that you're able to take quality time in your day to make these comments. We encourage all of our shareholders to do this and to say whatever's on your mind. It's so important to us to hear exactly how you're feeling. So thank you so much. We're so grateful to each and every one of you. As there is no further business to come before this meeting, the business portion of this meeting is hereby adjourned, and we'll now open it to general questions.
Thanks, Marc. As mentioned earlier, we will now be happy to answer questions that are of general interest to stockholders. We'll adhere to the rules of procedure posted on the meeting website, where you can also find instructions for submitting questions. In the interest of covering as many questions as we can, we may summarize questions or cover similar questions at the same time. And, you know, to the extent there are questions that we don't get to due to time, we will incorporate those into our shareholder engagement program if we have contact information for the stockholder. Let's now go to the questions that have been received.
The first question is: The company has in place a director resignation governance policy that provides the board post-election discretion to determine whether to accept or reject the resignation of an incumbent director who fails to be reelected by the requisite vote. Does the policy undermine the voting rights of shareholders by allowing the board to have the final say on the unelected director's status? We appreciate this question that's been submitted. A couple thoughts that I'd share on behalf of the company. First, Salesforce does have a majority vote standard applicable to the election of directors, which is further implemented through our director resignation policy.
Almost 90% of companies in the S&P 500 have similar director resignation policies, which promote evaluation by the board of the circumstances underlying the vote, including shareholder feedback, as well as facilitating continuity and stability. Our director resignation policy applies only if an incumbent director does not receive support from a majority of votes cast in an uncontested election. The resignation policy allows the board to balance state law and other regulatory considerations with the rights of shareholders to express their views through the vote, evaluate shareholder feedback and options for responding to such feedback, and to give effect to the shareholders' vote, when appropriate. The next question is what factors are considered in making share buyback versus increasing the dividend? I ask our Chief Financial Officer, Amy Weaver, to take this one.
Great. Terrific. Thanks, Sabastian. You know, our capital allocation strategy is very simple. We will continue to expand our free cash flow margin as we scale. We will invest in innovation, and we will return cash to shareholders through both our share purchase programs and now our dividends program. You know, in addition, as part of our goal to optimize shareholder value, we're focused on delivering strong free cash flow per share by driving both profitable growth and managing solution. You know, altogether in Q1, we returned more than $2.5 billion in the form of share repurchases and dividends. That brings the total return to date up to above 14 billion.
To answer your question specifically, I believe that having both a share buyback program and a dividend program provides a powerful combination, where the dividend is a relatively fixed commitment, and the buyback, where it provides much more flexibility for us.
Thank you. Our next question: Did the board of directors take any action to respond to the 17% vote against management pay at the 2023 annual meeting? And the question being posed, the view of this individual, is a 5% rejection is often the norm at well-performing companies. I'll ask John, our Compensation Committee chair, to address this question.
Yes, thank you for that question. I mean, first of all, let me point out that our board and our compensation committee talks to hundreds of shareholders a year, and we take very seriously the input that we get. We have a very, very high-performing executive team, but we also hold them to high standards. Each year, we set comp based upon a number of factors that results in both increases but, and decreases in equity and overall comp. We also make adjustments to our underlying metrics, performance metrics. We've done several in the last couple of years, including operating margin metrics and increasing the, the balance of performance units in the overall comp. The answer to the question is... Let me make one other point.
We met 27 times this last year and over 20 times the year before. This is a committee that is constantly analyzing the right balance, the right level of compensation for our stellar executive team. So thank you for your question, and we will continue to provide, to apply those high standards in the future.
Let's see, our final question states the following. I'll note the question does have some inaccuracies, but I will state the question as presented. Salesforce dropped the RNC as a client, has threatened to divest from states like Georgia and North Carolina over religious freedom laws, and will not do business with legal firearm sellers, according to the conservative 1792 Exchange. How is this blatant side-taking beneficial to shareholders who invest for purposes of return? You know, with respect to this question, as noted, there's some inaccuracies, including references to customers who have actually been long-standing customers of the company across administrations. We have items and apply them in a non-partisan way.
You know, with respect to the other items, you know, the companies like ours, you know, have various, you know, policies, procedures and the like. We welcome feedback, but fundamentally, again, we apply and move forward in a nonpartisan way with respect to items of importance. Thank you. So this concludes the Q&A session. Again, we value shareholder feedback and engagement. We value your input. Thank you for participating. And, operator, given that the meeting has and this portion of the session is concluded, you may now disconnect.
The conference is now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.