Hello, and welcome to the Ecolab Annual Meeting of Stockholders. I now would like to turn the conference over to Doug Baker.
Thank you, and good morning. I'm Doug Baker, Ecolab's Chairman and Chief Executive Officer. We're having a little difficulty with our provider opening the slides, but we'll catch up in a few minutes. Let me do the introductions. They certainly don't need any visual backup.
So first of all, this is our 1st virtual annual meeting of stockholders. Obviously, it's a different format. If you've attended in the past, you'll notice today's meeting will be different. Typically, we gather at our headquarter building in St. Paul, Minnesota, replete with lemon bars.
So I apologize for the lack of nourishment, but today is a very unique moment in time. The world's grappling with a health issue of enormous scale and great human impact as we navigate COVID. So this year was neither appropriate nor really even possible for us to have a in person meeting, which is why we're sharing this webcast virtually with you today. Joining me is Mike McCormack, our Executive Vice President, General Counsel and Corporate Secretary. Mike will be conducting the formal portion of the meeting.
Following the business portion of the meeting, I will address our recent financial performance and speak to you about Ecolab's business opportunities. After that, we will have a Q and A session. A webcast replay of this meeting will be available on Ecolab's website through May 14. So let me start though by extending a special welcome to any formal Ecolab associates and retirees listening to the broadcast of this meeting. We're pleased that you're a part of our audience today and we thank you for your past service and contributions.
I would also like to welcome our Executive Committee and Corporate Officers who are participating at this meeting virtually. Hard work and commitment from you and your teams, your leadership, particularly during this very difficult time are making a huge difference for the company, for our customers and as a consequence for communities. Now let me also introduce the 12 directors standing for nomination today and who are also in attendance via virtually for this meeting. First is Sherri Ballard. Sherri is a former Senior Executive Vice President and President of Multi Channel Retail of Best Buy.
She's been a Director of Ecolab since 2018. Barbara Beck is a former Chief Executive Officer of Learning Care Group and a Director of Ecolab since 2008. Jeff Edinger is a retired Chairman of the Board and Chief Executive Officer of Hormel Foods Corporation. He's been a Director of Ecolab since 2015 and Jeff serves as a Board of Directors' Lead Director. Arthur Higgins is President and Chief Executive Officer of Versertio Therapeutics and has been a Director of Ecolab since 2010.
Michael Larsen, Chief Investment Officer to William H. Gates III and Business Manager of Cascade Investment has been a Director of Ecolab since 2012. Dave McLennan is Chairman of the Board and Chief Executive Officer of Cargill and a Director of Ecolab since December 2015. Tracy McGibbon is Founder and Chief Executive Officer of Mack Energy Advisors and a Director of Ecolab since 2015. Lionel Noel is former Senior Vice President and Treasurer of PepsiCo and has been a Director of Ecolab since 2018.
Victoria Reich, former Senior Vice President and Chief Financial Officer of Ascendant and a Director of Ecolab since 2009 and Zan Votranoe, President of Kilovolt Consulting and Retired Major General of the United States Air Force and has been a Director of Ecolab since 2014. And last, John Zilmer, Chief Executive Officer of Aeromark, a Director of Ecolab since 2006. I guess he was the last time the final nominee standing for reelection. But I'd also like to take a moment to acknowledge a Director who is retiring today, Les Biller. Les joined our Board in 1997.
He has served on virtually every committee. He's led several. He's been instrumental in helping move this Board and this company over this period of time. Personally, he was a great mentor for me, particularly in my early years as CEO. He reached out a number of times, gave wise counsel and very helpful counsel.
Much of
it I took, some I didn't and that I chose to regret later on. So Les, you've been really unbelievable and a huge, huge contributor to this company's success over these years. We've benefited from your wisdom, experience and knowledge, and we will miss you and appreciate all that you've done for the company. So I just want to salute you in front of the stockholders, and obviously, we'll have a chance to do some other things going forward. So on behalf of my fellow Board members, we want to thank Wes and wish him well.
And now, let me turn the meeting over to Mike McCormack, our GC and Corporate Secretary. Mike?
Great. Thank you, Doug. Good morning, everyone. Before we proceed with the formal portion of the meeting, I would like to go over the mechanics of our virtual meeting. If you would like to submit a question during the meeting, you may do so by typing your question in the box located on the bottom left hand corner of the website of the webcast screen.
You will have the opportunity to submit questions on the matters to be voted on during the formal portion of the meeting. There will also be a general Q and A period immediately following the remarks of our CEO, Doug Baker. Additionally, if you have not already voted your shares, you may do so by clicking on the Vote Here button at the bottom right of the webcast screen. Note that only validated shareholders will be able to ask questions and vote in the designated field at the web portal. The polls will remain open until the conclusion of the discussion period on the matters to be voted on.
I will now conduct the formal portion of our meeting. A list of shareholders as of the record date is available for inspection by shareholders using the registered shareholder list link found on the webcast page. We have received an affidavit signed by Broadridge Financial Solutions that notice of this meeting, along with the related proxy and annual report materials, was mailed or made available on March 23, 2020, to Ecolab shareholders of record as of the close of business on March 9, 2020, our record date. Accordingly, notice of this meeting was timely given to the holders of our common stock. With more than 88 of the issued and outstanding shares represented in person or by proxy, a quorum is present for the conducting of business.
There are 4 items properly brought before the stockholders today. The first item is to elect the 12 nominees to the Board of Directors for a 1 year term ending at the 2021 Annual Meeting. The Board recommends a vote for each of the nominees. The second item is ratification of the appointment PricewaterhouseCoopers as the company's independent registered public accounting firm for the current year ending December 31, 2020. The Board recommends a vote for this proposal.
The 3rd item is to approve on an advisory basis the compensation of the executives disclosed in the proxy statement. The Board recommends a vote for this proposal. The 4th item is a shareholder proposal regarding proxy access. Operator, please open our line for John Chevedden to introduce himself and to present the proposal. Mr.
Chevedden, meeting rules allot 3 minutes for your comments.
Hello. This is John Chevedden. Can you hear me okay?
Yes, we can.
Okay. Proposal 4, make shareholder proxy access more accessible. Shareholders request that our Board of Directors take the steps necessary to enable as many shareholders as may be needed to aggregate their shares to equal 3% of our stock owned continuously for 3 years in order to enable shareholder proxy access with the following provisions. Nominating shareholders and groups must have owned at least 3% of the outstanding shares of common stock of the company continuously for a period of at least 3 years. Such shareholders shall be entitled to nominate a total of up to 25% of the number of authorized directors.
Proxy access for shareholders enable shareholders to put competing director candidates on the company ballot to see if they can get more votes than some management's director candidates. A competitive election is good for everyone. This proposal can help ensure that our management will nominate directors with better access. If shareholders if shareholder proxy access were more accessible, then a director might have more of an incentive to avoid being rejected by 31% of shares at our 2019 annual meeting as was the case with Mr. Arthur Higgins.
Under our current restricted proxy access, if 20 shareholders combined hold $1,600,000,000 of company stock and are $1 short in owning 3% of company stock, they are totally out of luck. They cannot ask a 21st shareholder to join their ranks. The largest shareholders of a company can be the least likely shareholders to use proxy access. It can be more complicated for large shareholders to use shareholder proxy access. There is a growing awareness of this reality.
Under this proposal, it is likely that the number of shareholders who participate in the proxy access aggregation process would still be a modest number due to the administrative burden on shareholders to qualify as one of the aggregation participants. Plus, it's easy for management to reject potential aggregating shareholders. The administrative burden on shareholders can lead to a number of technical errors by shareholders that management can quickly reject. Please vote yes, make shareholder proxy access more accessible, proposal 4.
Thank you. The Board recommends a vote against this proposal for the reasons set forth in the company's proxy statement. I will now open the floor for shareholder questions on the matters to be voted on. Please limit your remarks to those matters. There will be a general Q and A period at the end of the meeting.
As a reminder, to submit a question during the meeting, you may do so by typing your question on the box located at the bottom left corner of the webcast screen. To read each question. We'll take a moment to see if we get any questions. Okay. There are no questions, so we will resume the formal portion of the meeting.
The polls are now closed, and I will now report the preliminary voting results based on the proxies already received. The 12 director nominees were overwhelmingly approved. The proposal to ratify the appointment of auditors and the advisory vote on executive compensation were overwhelmingly approved with each of those matters receiving at least 91% of the shares cast. Finally, with respect to the proposal regarding the quest for proxy access, that proposal received less than 33% of shares cast in favor and was not approved. The final vote results will be reported to the SEC on a Form 8 ks, a copy of which may be found on Ecolab's website.
This concludes the formal business portion of our meeting. Before turning the meeting over to Mr. Baker, let me note that remarks made during the following presentation by Mr. Baker concerning future expectations, plans and prospects for Ecolab constitute forward looking statements under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those projected by these forward looking statements.
Information concerning factors that could cause actual results to so differ include those factors discussed in the company's annual report on Form 10 ks found under Item 1A Risk Factors. I now turn the meeting back to Mr. Baker to adjourn the formal business portion of the meeting and to offer some comments about the business.
Thank you, Mike. I now declare the formal business portion of the meeting adjourned. Now, let me share a business review. Following this, we'll open it up for Q and A. So obviously, COVID is the subject of the day and obviously has a big influence on our business, which of course I'll address.
First, let me talk safety and certainly COVID has entered our safety discussions across the company and across our customer relationships. The good news is on fundamental safety measurements, in the upper left is our workplace injury rate, lost time injury rate is the upper right, which is the more severe injuries. Our vehicle accidents lower left and our severe vehicle accidents is the lower right. In all cases, we continue to make excellent progress making Ecolab workplaces safer. Our goal here is 0 on all four of these metrics.
We continue to strive to get there. Importantly, this is a top priority for the company, is measured regularly. We start every meeting with our safety metrics. And the second way we start with is a safety moment, which I will do here as well. And our safety moment today is really how do you wear effectively a face mask.
And most importantly, the face mask is to prevent us from expelling COVID and also provide some barrier for inhaling COVID. If you grab the mask in any place other than the elastic bands that go around your ears, you are creating risk for yourself and for others. So the most important thing to remember when you wear a mask is not to touch it with your hands. If you're going to touch any part of the mask, it really does need to be the straps that go behind your ears. And that's the most important thing to remember.
Masks themselves can be irritants. They can drive people to touch their face more frequently. So this needs to be a conscious decision by all of us as we learn to wear these masks. I am a wearer of masks whenever I'm in the office, which is quite infrequent at this point in time. So let me move on to results of the business.
And I'll start with a brief overview of the last couple of years, which have been good years for the company. And it's important because I think it gives a backdrop to both our Q1 in 2020 and our expectations going forward. So in both years 2018 2019, we had double digit adjusted EPS. The stock price also performed well in relationship to the market. We outperformed the S and P over the 2 year period by 18% and outperformed both in 2018 and in 2019.
What drove this principally was great, great execution around new business. It's driven by innovation. It's driven by our formula around reducing energy and water footprints, which drives economic benefit, which makes our world class programs cost effective too. It's this marriage of ESG strategy, economic benefit and world class outcomes that drives the success of our business. And you can see here that over this period of time, we accelerated our new business net new wins, if you will, activity, which is really the fuel for growth over time.
Going into Q1, we still had very strong momentum. And while Q1 sales were only up 3%, we had some negative COVID sales impact. But in fact, COVID helped adjusted EPS because fundamentally, we saw a greater faster reduction in expenditures because of COVID, like travel in particular and other internal expenditures, which more than offset the modest sales impact from COVID. Net, we had a 3% sales increase at management rates. We had a 10% adjusted EPS impact, which was at the very top end of our guidance.
But importantly, this is better than we expected. While the underlying business improvement helped drive this, we also know that this is not going to be indicative of the rest of the year. The COVID will have a significant impact on our sales. During our last update with the financial analysts, we were very clear on our earnings call about our expectation that Q2 in particular would be very adversely impacted from COVID simply because it's going to have 2 issues. Reconcile their inventory with new demand levels.
This combination is going to make Q2, we believe, likely our low point for the year in terms of sales, which will also make it likely the low point in the year in terms of income as well. That's the expectation we shared with the financial analysts. So while COVID is a short term challenge for all of society and for our business too, we do believe long term it's more likely a tailwind than not. But obviously time will prove that right or wrong. The reason we believe that is that we expect heightened hygiene expectations to continue.
We think people are learning new habits, expectations have changed, and we don't believe those are going to quickly dissipate. We also believe that the digital connectiveness advantages that we've been investing in so significantly over the last 5, 6 years are going to become even more important going forward, That our customers are now experiencing the measurement, monitoring and service capabilities that we can do both in unit and remotely And we believe that that trial, if you will, is going to that experience that customers are having is going to make them even more way that's even more importantly going forward. So both we think are important. So let me talk specifically around COVID. COVID impact seems to be asymmetrical almost in all measurements, who it infects, how people respond to the infection, And our business also is asymmetrical.
We've got some businesses, those on the left in the red that are severely impacted, full service restaurants, lodging, entertainment venues, cruise lines, et al. And then if you shift over to the right, we have a number of businesses that are in a way demand is up as a consequence of COVID. Certainly, our healthcare business, our business any business with sanitizers, surface, hand, et al. Our food and beverage business, because there's been a huge shift in pack sizes from former food service to retail or consumer and our food and beverage customers have been dealing with this big shift in this big demand change. Grocery, our business food retail business, which really serves grocery stores around the world has had very much outsized demand as a consequence.
And our Life Sciences business because of the decontamination capabilities, which are now used in new novel ways, has also seen significant uptick in sales as a consequence. So while we have pluses and minuses, I'll remind you, we still expect these to end up to be a net negative for the year from a sales standpoint, particularly in Q1. But it's not a story of 1 or the other. It's really a story of a combination. And when we look at the businesses that are impacted positively, they represent 33% of our sales post the spin off of upstream.
The demand depressed businesses represent 31%. So you might look at this and say, well, why is it a net negative? And it's simply a case of those that are impacted negatively are impacted more severely than those that are impacted positively are impacted in terms of percent of sales. We do expect over periods of time to see recovery and that recovery we expect to start sequentially Q3 and Q4 even though we expect COVID to last well into 2021. So as we look at this, we've really divided our response to COVID into 4 clear phases.
Now while these phases have uncertain timing because really it's going to be dictated by the disease, these phases are clear. So the first was a response phase, which were largely is largely behind us. I'll talk about the actions we took for our customers, for our team and for our company. The second phase has been a very important one and that is understanding what changes COVID is likely to bring to our company that aren't just temporary, but will likely be lasting, I. E.
Around hygiene expectations being heightened, around digital's importance would be 2 good examples, etcetera. And then retooling, helping our customers reopen when that's the case. It is the case in Asia and a number of markets. It's increasingly the case in Germany, in particular in Europe. And it's the case in a number of states that are reopening starting next week in a number of key states in this country.
But we need to be there to make sure that they can meet the consumer expectations, they can operate safely, and they're ready to operate in a new way because of COVID. And then finally, what programs are we going to be introducing that we think will have even more staying power long term? So Phase 1, which is behind us, was a very important phase. And it was really under these three headings. 1st was making sure we took care of our team.
It is one of the most important assets we have. It is the vehicle by which we protect our customers and our customer protection is the way that we protect our company and ultimately our communities. And we wanted to make sure that they could do their work safely, not only in the field, but importantly in our manufacturing facilities and in offices. We put in a pay protection plan to protect those that are highly commissioned, particularly those facing industries like food service, hospitality, they would have seen pay cuts in some cases of 30% to 40%, which obviously is a shock to the system because it occurs so quickly. And we wanted to make sure that they had some stability in income and time to see recovery because they play an important role in our company.
We did a lot of work to protect our customers. We maintained our production and actually have enhanced it significantly because we've had a huge uptick in demand around hand sanitizers, hand care products generally, surface sanitizers, antimicrobials and the like. We also wanted to make sure that we had field and tech support positioned to take care of customers. We try to do as much as we can remotely, as much as we can without entering the unit, but there are cases where we have to go into customer units and we want to make sure our people have the PPE and also the processes to do that safely. Social distancing, what time of day would they be doing this and how would they perform these functions.
We spent a lot of training time on this upfront. And finally, these steps obviously help protect the company, but we also took time to make sure our balance sheet and cash reserves were sufficient. We ran a number of scenarios. We had special Board meetings to share with the Board how we saw this potentially manifesting itself, and we also did severe cases and frankly catastrophic cases to make sure that we would have enough cash to keep this company safe and healthy. The truth is nobody appreciates a great balance sheet until it's needed.
We learned this clearly in 'eight, 'nine. We've learned it again. And our policy of having a strong balance sheet always has always been a source of strength for this company and it proves so once again. Because as a consequence of this balance sheet, we can manage through this in a much different fashion than those companies who are scrambling to stay alive and to survive. And that's a lesson we've learned several times and a lesson we don't aim to forget ever.
But we do have enough cash, we are in a good position, and we are now managing this event in what we think is a very smart way. And that is manage this year with a very strong eye on the future. What steps do we need to take? What innovations do we need to launch? What investments do we need to protect because they're going to be even more vital in the future?
So while we've slashed capital nearly 50%, we do not slash $1 of investment on our digital investments, on our antimicrobial R and D investments, on a whole number of what I would call upscaling manufacturing investments, etcetera, we protected those as we went through. While that may harm this year a little bit from a optical standpoint financially, it's the smart play long term, we believe both for our customers, our communities and for our shareholders. So now we are doing a lot of work and a lot of things are happening around this company. We have stepped up and ramped up volume of hand sanitizers in a material way. We are still continuing to search for vehicles to up that even further.
And so this is up 8x to 10x in some markets. We don't have a lot of plants lying fallow waiting for monstrous demand change. So we've had to be quite creative in finding ways to meet this demand. And I would say I'm very proud of the steps that our team has taken to do exactly this. We are continuing to leverage our digital investments.
We're working collaboratively. We've talked a lot to customers about new ways to serve them. And this in turn has opened up new opportunities both near term and long term. Now we're working very hard to help our customers recover and rebound as we move into the to latter stages of this recovery. Importantly, we want to make sure we're providing the training they need to open safely.
They are going to have to operate differently if you're in lodging. They're going to have to operate differently if they're in food service. Our food and plant customers, food and beverage manufacturing customers are having to operate differently to create social distancing, change processes with their workflow. We are monitoring and making sure that the antimicrobials are using are being used properly and correctly in a time where they have a lot of change management going on in their facilities. So all these things are working together and our team is doing a great job making sure that we're taking care of customers.
Our outlook on COVID, as I mentioned, is ultimately this is temporary. Temporary though is a definition we don't know how long this is. Is this month? No. We think it's largely going to go into 2021 and we don't know when it's over during 2021.
We're prepared, I would say, for a long slog and making sure that we do the smart things during this period. But our positioning cleaner, safer, healthier is going to be even more relevant in the future, we believe. Our antimicrobial, ESG know how will matter even more going forward. And we're managing 2020 2021 like the future is the most important thing we've got to keep our eye on. How do we make sure we emerge from COVID better prepared to serve customers, better prepared to serve communities and better prepared to deliver for our shareholders.
So ultimately, we believe we're positioned well for long term success. But part of this is because of steps that we announced quite early. One was the spin off announcement of our upstream business and then subsequent decision to merge that business with Apergy and a Reverse Morris Trust. The first announcement was early in 'nineteen, We announced the Reverse Morris Trust with Apergy in December. We said at the time that we expected this to be completed by the end of Q2 2020, and we still remain on that timetable.
In fact, we've already initiated the 20 business day exchange period for this transfer to occur. And so we are early days in that, but that time clock has already started. So we can remain on level to get this done. So the exchange offer and the way this is going to work is shareholders will have an election or a decision to make. And that election or decision is you can exchange a number of your Ecolab shares, small percentage or all of them, and in turn, you will get Apergy shares post merger, I.
E. Once it's a combined business with the upstream business. That ratio, I. E. The number of Apergy shares that you will receive in exchange for an Ecolab share will be determined over a period of time, May 27 to 29, based on the volume weighted average of Ecolab and Apergy share prices during that period of time.
We will then have a ratio, I. E. You get 20 shares of Apergy or whatever that number will be. That is just an example. Then you will have a determination.
Do I want to submit and exchange an Ecolab share? Yes or no. If you do nothing, then the default is no exchange, that nothing will happen. You will retain your Ecolab shares as you do today and you will not be given any Apergy shares. So this will occur obviously near the end of this month and early into the next month and that timetable is still moving forward as we expect.
Post this spin, you will have a different looking business. On the left is what sales by segment looked before we move upstream out and sales by segment after spin is depicted on the right pie chart. And fundamentally, we feel that the businesses as we'll be positioned post spin are even more appropriate moving forward. This upstream spin we believe is good for the upstream business, it's good for the Apergy business, it will be good for their shareholders. But we also believe this is going to be beneficial to Ecolab as a company and Ecolab shareholders going forward.
And most importantly, after the spin, we still will chase a huge growth opportunity, which we estimate to be conservatively $130,000,000,000 We have only a 10 share. So while we are clearly the leaders in this industry, it's quite fragmented from a competitive standpoint, It continues to consolidate from a customer standpoint. This combination represents great opportunity for us as a company. We continue to push forward to make that blue pie larger, but simultaneously, we will want to make that 130 opportunity grow as well. And this opportunity is available in every market we compete in.
So the green depicts total opportunity and the blue depicts what we've secured today. And in every business we're in, we have plenty of room to grow. And we believe strategically, this is one of the most important factors in this business. We remain in our belief very early in our growth story and very early in our ability to grow this business long term. The positioning we have, which has been very relevant today, we believe is going to be even more relevant going forward, I.
E, our promise around hygienic space cleanliness, safe food, clean water and sustainable environments is going to be, we believe, even more importantly post COVID than it has been pre COVID. And the backbone of this is our customer value proposition. So I alluded to this earlier. The way we go to market is we commit and promise world class results. So in a food and beverage environment, we deliver best in class food safety outcome and results.
But we do it while simultaneously reducing water and energy footprints. This in turn lowers total operating costs and enhances sustainability dramatically. This formula is a very important part of our success factor. It's got economic advantages and sustainability advantages. I get asked, will ESG be as important post COVID as it was before?
I believe the answer to that question is yes, but I'm also not worried about it because I also know that the heart of our equation is both economic and sustainability. So we have both benefits coming to our customers. As a consequence, this has got long legs in terms of its capability. And we're able to leverage this formula across a very, very strong customer base. This is only a few of the large customers that we serve.
Our largest customer represents less than 2% of our sales, So it's a very balanced portfolio. But importantly, it represents a huge opportunity. And as we leverage our business formula on that customer base, we deliver outsized benefits in terms of ecology. So last year, we estimate that we conserved over 200,000,000,000 gallons of water by helping our customers reduce their water consumption. We recently sold a customer where we will sell or help them reduce 2,000,000,000 gallons a year, one customer.
That is the equivalent of what we consume as a company in a year. So the leverage here is phenomenal in terms of our ability to make a difference in the world. This 200,000,000,000 gallons of water saved is equivalent to the drinking needs of 700,000,000 people. So it's not small, it's quite big. When we save this water, we simultaneously save significant CO2 or BTUs.
We estimate 28,000,000,000,000 BTUs were saved in 2019, and that's a very important factor because that obviously helps air and carbon, but it also is what creates the economics for our customers, because energy, while cheaper, still remains a significant cost. But that's not all we do. We also reduce foodborne illnesses dramatically reduced by our world class technology. We help make the world's processed food safe, the global milk supply, clean kitchens which serve over 58,000,000,000 restaurant meals, and we also take care of healthcare facilities. We have cleaned over 3,500,000,000 surgical instruments last year, we cleaned 15,000,000 patient rooms, and we also our products were used to clean over 40,000,000,000 hands.
So that's obviously multiple instances for 8% of the population. And as a result of this, we bring outsized environmental benefits. We do it while also having excellent financial performance and also recognized for being an ethical company. And all three of these have been recognized by a number of important bodies and this we feel very good about, but we also believe that there's more to come. So importantly, as a consequence of all this, ESG funds have made us one of their top choices because of our ability to make a difference both environmentally, socially and strong governance principles.
We're the number one non tech stock held in these funds around the world and given our market cap size, we have significant holdings relevant to our size. So our purpose, making the world cleaner, safer, healthier and protecting people and vital resources has been our ongoing strength. It's guided us as we've navigated through this COVID dynamic in terms of what our priorities are, how we're going to pursue choices. We believe it's been part of our strength coming into this and we feel it's going to be even more important as we move out of it. So that's my formal presentation.
We appreciate your trust in us as shareholders. We work hard to re earn that trust every day and we will work hard in 2020 to be a company you can continue to be proud of. So with that, we will enter a Q and A period. I know Mike already talked about how you do this. I will leave this up there in case you would like to submit a question.
I understand we have a number already. So I'm going to have Tim Beistrom read off the questions that have been submitted and we will work to answer all of them. Thank you.
Doug, we've got 11 questions in the queue, of which have already been answered in your presentation. So the first question was what is your COVID-nineteen strategy?
Yes. I think as you alluded to, Tim, we work to walk through that. And I would just say the underlying theme for the COVID strategy is make sure that the company keeps its eye on post COVID period and that what we're working to do is maximize our capabilities in terms of helping customers and helping communities post COVID. Those are the investments we're protecting, the new investments that we're making. It's why we're protecting our team and others because they're going to be instrumental in doing this.
The next question is what is your ESG strategy?
Again, hopefully, we walk through it. At the heart of our ESG strategy is really the environmental benefits that we bring through helping our customers reduce their water and energy footprints. And so in many ways, in water, it's a 100 to 1 ratio in terms of water we consume and water we're saving with our customers. That doesn't mean that we don't also have internal targets on water reduction and carbon reduction, we do, and we aim very hard to meet and exceed those. But we know where our biggest benefit is there.
From a social standpoint, we have very clear goals in making sure that we create great opportunity within our company, that we help create great opportunity in the communities that we serve, that diversity is a prime goal of ours. And I think you can see steady progress both at the Board level and the management level and throughout the company.
The next question is what's the status of Ecolab spinning off the energy business?
Well, as I mentioned earlier, we remain on target to make this happen well before the end of the second quarter. So, we're in good stead there, and we're going to continue to execute.
Next question is whether and how many employees of Ecolab have contracted COVID-nineteen?
At this point in time, we are around 50 globally. Unfortunately, we recently had one of those who contracted COVID die, one of our associates in Dubai, which was a terrible tragedy. But that's where we are right now. So we work very hard to make sure that number doesn't go up.
The next question was how many shareholders are attending this meeting? And the answer to that is there is approximately 40 registered and about 65 guests who may also be shareholders, but may not have had their retained their registration number. Next question is, is there any promising new technology to protect employees from the spread of COVID-nineteen?
Well, I mean, we aren't the one that is going to be developing, if you will, measures either for vaccination and or for treatment of COVID. That's other companies' responsibility. For us, I think there is very clear evidence that if you do social distancing, if you wear the proper PPE, including masks throughout your daily life and you follow these procedures that you can have a significant reduction on the RO or if you will, the transmissibility of this virus. And that's the single most important thing that we all have to work on. So we have at this point in time really shut our offices.
The only people working in our facilities are those who can't do their work anywhere else. So obviously in manufacturing environment, that would include our manufacturing associates. It would include several of our lab technicians, those who are doing work around food safety and or health acquired infection, monitoring and the like that need lab work. In all those instances where people still need to be in a facility, we have changed procedure, we're monitoring, we're providing PPE, we're monitoring temperatures, we're doing a number of things to make sure that those environments are as safe as possible. We've made sure that people aren't in locker rooms simultaneously.
We've adjusted shift times and the like and tried to take every step possible to make sure that we make our environments as safe as possible.
Another COVID related question is what percent of employees can do most of their work at home?
Well, our field team has learned that they can do, let's say, a lot of their work remotely, but not 100 percent of their work. Our field team represents half of our team. Our manufacturing represents another 25%. So I'd say 3 quarters of our team needs to continue to be actively engaged one way or another. And I just mentioned, we've put in place a lot of procedures and I talked earlier about field protocols.
The balance of the team, the very small percentage that needs to be in the office. So we have a facility that I'm sitting in today that housed at one time nearly 1500 and on an average day has less than 50. So we have dramatically ramped back where we can. We will not reopen anytime soon the facilities where we don't require people. I think we've all learned that working remotely is a lot more effectively a lot more effective than we feared.
We're developing new skills. It's not something we want to do for the rest of our lives, but it's the smartest policy right now in terms of making sure that we protect our team, which in turn, by the way, protects the communities that we work in.
Next question relates to executive compensation. For executive compensation, Ecolab removes restructuring costs from their bonus calculations. Why aren't executives sharing the same sharing the costs as well as the benefits of restructuring in their executive compensation?
Well, I'd say we will, but the way we do this is twofold. 1, we include in the budget the benefits from restructuring costs in our executive comp targets and we also have a budget for restructuring costs that's agreed to prior early in the year that's related to that. We stick within that budget and if not, then there is discretion that the comp committee has on lowering budgets. But we include the benefits and manage the other budget. So both are done.
I would also say in stock repurchase, the benefit that we expect to get is budgeted in our EPS targets for the year. I don't know of any year where we ever exceeded those going forward. Typically, we undershoot not overshoot in terms of EPS benefit from budgeted, if you will, stock buyback scenarios. So it is included, both are.
There's been recent growth in the size of passive mutual funds, corporate ownership interest in U. S. Corporations That raises important public policy and corporate governance issue. Currently BlackRock owns 6.8% and Vanguard 7%.
Well, I can't speak for the whole Board, obviously. I will offer this. I mean, we're clearly aware of the trend. I would say we do not believe to date that it has had any influence and we will work hard to make sure that any influence it does have turns into a positive influence. We work very hard to manage this business both for the short term in a way that also promotes long term capabilities.
And I think we've done this continually for decades, which is why this company has performed well for so long. And the Board has been one of the steadfast drivers of this position. We never sacrifice a year, sacrifice a long term to make a year. We work very hard not to do this. There have been plenty of times that there's a mismatch between Wall Street's quarter expectation and what we believe is viable or done smartly by our business.
And we have been very frank with Wall Street about what our expectations are for a quarter, whether they meet theirs or not and why ours might be different and what they can expect going forward. This year, a good example is we do not have the capability of foreseeing what earnings are going to be with any clarity going forward. So we have stopped giving guidance as a consequence of this. Typically, our business is fairly easy to forecast, if you can use the word easy in a sentence with forecast, simply because we have annuity streams. In our customers' business, if you will, the underlying business has been fairly steady.
But their business now is completely disrupted. As a consequence, our annuity streams are disrupted. So we don't have the normal visibility. And so we've been very clear with the financial community not to expect guidance until sometime when we believe it makes sense to bring it back if there's ever a time that makes sense. So that's how we're viewing things.
We try to manage intelligently. We believe delivering in the short term typically is a very smart way to achieve long term benefits, but don't do it while sacrificing the future.
Two questions remaining. Next to last question is, the issue of audit firm independence is critically important to protecting the integrity of corporate financial reporting. Could you describe the periodic lead partner, lead auto partner rotation process and the decision making authority in selecting the new lead partner? And I can take that or you can read it.
Look, we follow the SEC rules, which require Lee Auditor rotation every
Board canceled its compensation increase that was previously approved in October 2019. How much savings in dollars was this?
Well, the increase that the Board chose to rescind had been put in place or agreed on in October of 2019 to be effective January 1, 2020. So obviously, COVID wasn't a word anybody knew how to spell in October of 2019. Typically, our Board comp goes up every other year. They choose not to raise it every year. This increase was a 7% increase because they hadn't had an increase since 2017.
And we shoot for the median of companies our size is where we target, where the Board targets Board compensation. So it was a 7% increase over that 2 year period. In total, that would represent roughly $300,000 of compensation savings as a consequence of their decision.
Doug, that's all the questions that were in the queue.
All right. With that, I'll close this portion of the meeting as well. And again, thank you for your trust. We'll continue to work hard to earn it going forward. All the best.
Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines.