SEMPRA ENERGY | Separate Chair & CEO at SEMPRA ENERGY

Status
Filed
Previous AGM date
Resolution details
Company ticker
SRE
Lead filer
John Chevedden
Resolution ask
Adopt or amend a policy
ESG theme
  • Governance
ESG sub-theme
  • CEO / chair duality
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Utilities
Company HQ country
United States
Resolved clause
RESOLVED : Shareholders request that the Board of Directors adopt an enduring policy, and amend the governing documents as necessary in order that 2 separate people hold the office of the Chairman and the office of the CEO as soon as possible.
Supporting statement
The Chairman of the Board shall be an Independent Director. A Lead Director shall not be a substitute for an independent Board Chairman. The Board shall have the discretion to select an interim Chairman of the Board, who is not an Independent Director, to serve while the Board is required to seek an Independent Chairman of the Board on an accelerated basis. This policy could be phased in when there is a contract renewal for our current CEO or for the next CEO transition although it is better to adopt it now. An independent Board Chairman at all times improves corporate governance by bringing impartiality, objective oversight, and external expertise to board decisions, mitigating conflicts of interest, enhancing transparency, and boosting shareholder confidence. This detached perspective allows the chairman to focus on shareholder interests , strengthen management accountability, and provide critical checks and balances, ultimately contributing to long-term sustainability and credibility. This may be a particularly good time to consider the merits of this proposal. Sempra stock was at $80 in 2020 and at only $91 in late 2025 during a robust stock market. Several unfavorable news reports and developments regarding Sempra Energy emerged in 2025. In February 2025, Sempra reported disappointing fourth-quarter 2024 results and cut its 2025 earnings-per-share outlook. Following this lowered forecast, Sempra's stock dropped by nearly 20% in a single day, leading the S&P 500 in declines. While the company's stock trended upward at times, it has been a significant underperformer compared to the broader utility sector throughout 2025. Sempra's second quarter 2025 revenue fell short. GAAP earnings were also significantly lower compared to the same period in 2024. Analysts have pointed to Sempra's exposure to "regulatory shifts and policy risks" in its key markets of California and Texas as a major risk factor. In January 2025, and reiterated after a September transaction, S&P Global assigned a "negative outlook" to Sempra's credit rating. The negative outlook was based on several risk factors, including: ? Sempra had a minimal financial cushion for its consolidated financial measures. ? Sempra faces execution risks related to the construction of large liquefied natural gas projects, including the Port Arthur LNG project. ? The credit rating could be lowered if Sempra subsidiary San Diego Gas & Electric were to cause a significant wildfire.

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