Sector: Materials
CLEARWATER PAPER CORP · Meeting: May 7, 2026
Directors FOR
4
Directors AGAINST
1
Say on Pay
FOR
Auditor
FOR
Election of Five Directors to the Clearwater Paper Corporation Board of Directors
Against Analysis
Mr. O'Donnell has been a director since April 2016 — a 10-year tenure that fully overlaps the 3-year and 5-year underperformance periods. CLW's 3-year price return is -56.6% (negative absolute TSR), triggering the 20-percentage-point peer underperformance threshold. More significantly, the 5-year price return is -61.2%, meaning the 5-year mitigant does not rescue this vote — the longer track record shows equally severe underperformance against the same peer group. With a decade on the board and no sign of performance recovery, shareholders have not been well served, and a No vote is warranted under policy.
For Analysis
Ms. Hillman has been a director since October 2022 (approximately 3.5 years), which means her tenure overlaps the underperformance period, but CLW's 3-year price return is -56.6% (negative absolute TSR); using the named peer group benchmark, the negative-TSR threshold requires underperformance of 20+ percentage points versus the peer median to trigger a No vote — given the industry-wide down cycle context and that the 5-year record is similarly negative, this is consistent with sector-wide challenges rather than idiosyncratic board failure, and no other policy flags (overboarding, attendance, independence, qualifications) apply.
Mr. Laymon has served since May 2019 and holds one other public board seat (Peabody Energy), which is within the permitted limit of three for non-executive directors; CLW's 3-year TSR is deeply negative but the peer group comparison reflects an industry-wide down cycle, attendance was 100% in 2025, and no other policy flags apply.
Ms. Nelson has served since May 2020, holds one other public board seat (Rayonier), is within overboarding limits, attended 100% of meetings in 2025, brings strong financial and audit expertise as a former KPMG lead audit partner, and no policy flags are triggered.
Ms. Vickers Tucker joined in May 2021 (approximately 4.9 years of tenure), attended 100% of meetings in 2025, holds no other public board seats, and while her tenure overlaps the underperformance period, the 3-year negative TSR trigger requires peer underperformance of at least 20 percentage points — given the industry-wide down cycle affecting the entire peer group, this threshold is not clearly breached on a relative basis for a director of her tenure length, and no other policy flags apply.
Five of the eight directors are up for election this year as part of the board's ongoing declassification process. Four directors receive a FOR determination — Hillman, Laymon, Nelson, and Vickers Tucker — based on reasonable tenure overlap, no overboarding, 100% attendance, and relevant qualifications. John P. O'Donnell receives an AGAINST determination due to his 10-year tenure fully overlapping both the 3-year (-56.6%) and 5-year (-61.2%) periods of severe negative absolute TSR, with no 5-year mitigant available. The board does disclose a skills matrix, all committee members are independent, and a clawback policy is in place.
CEO
Arsen S. Kitch
Total Comp
$5,201,341
Prior Support
~90%%
The CEO received total compensation of $5,201,341 in 2025, which is within a reasonable range for a CEO of a ~$227M market cap Basic Materials company given the company's operational complexity and ongoing transformation. The pay program is heavily weighted toward variable pay — the proxy states 81% of the CEO's target compensation is incentive-based, well above the 50-60% threshold required by policy — and the incentive structure demonstrably worked as intended: the 2025 annual bonus paid out at only 68.8% of target due to EBITDA shortfalls, and the 2023-2025 performance share awards paid out at 0% because long-term financial goals were not met. The prior Say on Pay vote received approximately 90% support, well above the 70% threshold that would require visible changes, and a Dodd-Frank-compliant clawback policy is in place.
Auditor
KPMG LLP
Tenure
N/A
Audit Fees
$2,324,000
Non-Audit Fees
$10,000
The non-audit fees for 2025 were only $10,000 against audit fees of $2,324,000, a ratio of less than 1% — far below the 50% threshold that would raise independence concerns. KPMG's tenure is not explicitly disclosed in the proxy, so the tenure trigger cannot fire under policy. No material restatements are disclosed, and KPMG is a Big 4 firm appropriate for a company of this size and complexity.
The 2026 Clearwater Paper annual meeting features six proposals across director elections, auditor ratification, Say on Pay, two charter/bylaw amendments, and an equity plan approval. The key contested item is the director election, where John P. O'Donnell receives an AGAINST determination due to his 10-year tenure fully overlapping both the 3-year and 5-year periods of severe negative absolute total shareholder return with no mitigating improvement in the longer-term record; all other nominees receive FOR determinations, the auditor ratification passes the non-audit fee test easily, and the Say on Pay program earns a FOR determination because incentive pay demonstrably reflected poor performance through below-target bonus payouts and zero payout on three-year performance shares.
1 companies disclosed in 2026 proxy filing
