AVANOS MEDICAL INC (AVNS)
Sector: Health Care
2026 Annual Meeting Analysis
AVANOS MEDICAL INC · Meeting: April 21, 2026
Directors FOR
5
Directors AGAINST
3
Say on Pay
AGAINST
Auditor
FOR
Director Elections
Election of Directors
Against Analysis
Blackford has served since October 2014, covering the full 3-year period during which AVNS stock fell 50.5% versus the IHI — iShares US Medical Devices ETF which gained 8.7%, a gap of 59.2 percentage points that far exceeds the 30-percentage-point trigger for negative absolute TSR; the 5-year return of -70.7% versus IHI confirms sustained, not transient, underperformance, so the 5-year mitigant does not apply.
O'Leary has served since October 2014, covering the full 3-year period during which AVNS stock fell 50.5% versus IHI — iShares US Medical Devices ETF which gained 8.7%, a gap of 59.2 percentage points far exceeding the 30-percentage-point trigger for negative absolute TSR; the 5-year return of -70.7% versus IHI confirms this is sustained underperformance, not a transient trough.
Shimer has served since October 2014, covering the full 3-year period during which AVNS stock fell 50.5% versus IHI — iShares US Medical Devices ETF which gained 8.7%, a gap of 59.2 percentage points far exceeding the 30-percentage-point trigger for negative absolute TSR; the 5-year return of -70.7% versus IHI confirms sustained underperformance, so the 5-year mitigant does not apply.
For Analysis
Burke is a first-time nominee with no prior tenure at Avanos, so he is exempt from the TSR underperformance trigger under the 24-month new-director exemption; he brings relevant CFO and healthcare industry experience.
Cunniff is a first-time nominee with no prior tenure at Avanos, so he is exempt from the TSR underperformance trigger; he brings relevant CEO-level and healthcare industry experience.
Egbuonu-Davis joined in 2023, within the past 24 months relative to the 2026 meeting, so she is exempt from the TSR underperformance trigger under the new-director exemption.
Franchini joined in July 2024, well within the 24-month new-director exemption window, so the TSR underperformance trigger does not apply to her.
Pacitti joined the board in August 2025, well within the 24-month new-director exemption, so the TSR underperformance trigger does not apply; as the current CEO he is also subject to the same TSR trigger as other directors but is similarly exempt due to tenure.
Three long-tenured directors — Blackford (Chair), O'Leary, and Shimer, all serving since October 2014 — receive AGAINST votes due to severe and sustained stock price underperformance: AVNS fell 50.5% over three years while the IHI — iShares US Medical Devices ETF gained 8.7%, a gap of 59.2 percentage points that far exceeds the 30-point threshold for companies with negative absolute TSR. The five-year return of -70.7% confirms this is not a transient dip. The five newer directors — Burke, Cunniff, Egbuonu-Davis, Franchini, and Pacitti — all qualify for the 24-month new-director exemption and receive FOR votes.
Say on Pay
✗ AGAINSTCEO
David C. Pacitti
Total Comp
$9,469,803
Prior Support
N/A
The CEO received total compensation of $9,469,803 — a level that appears elevated for a company with a $633M market cap that has lost over half its value in three years while the IHI — iShares US Medical Devices ETF gained 8.7%, a gap of 59.2 percentage points. The pay-for-performance alignment check fails because variable and equity-based pay appears above benchmark levels while shareholders have experienced severe losses over the 3-year period; the incentive compensation structure is not delivering the shareholder alignment it is designed to produce. While the company uses performance-based awards (performance stock awards, time-based restricted stock, and options) and maintains a clawback policy, the combination of outsized CEO pay and persistent, severe underperformance relative to medical device peers as measured by IHI warrants a vote against this proposal.
Auditor Ratification
✓ FORAuditor
Deloitte & Touche LLP
Tenure
N/A
Audit Fees
$3,070,285
Non-Audit Fees
$408,786
Non-audit fees (tax services of $408,786) represent approximately 13.3% of audit fees ($3,070,285), well below the 50% threshold that would raise independence concerns; no material restatements were identified; Deloitte is a Big 4 firm appropriate for a company of this size and complexity; auditor tenure was not disclosed in the proxy so the tenure trigger cannot fire.
Overall Assessment
The 2026 Avanos Medical ballot presents significant governance concerns: three long-tenured independent directors who have overseen a 50.5% stock decline over three years — massively underperforming the IHI — iShares US Medical Devices ETF's 8.7% gain over the same period — receive AGAINST votes, and the Say on Pay proposal also receives an AGAINST vote given CEO pay of $9.47M at a company that has destroyed substantial shareholder value. The auditor ratification and the LTIP amendment for outside directors both pass without issues.
Compensation Peer Group
1 companies disclosed in 2026 proxy filing