CALIFORNIA WATER SERVICE GROUP (CWT)
Sector: Utilities
2026 Annual Meeting Analysis
CALIFORNIA WATER SERVICE GROUP · Meeting: May 20, 2026
Directors FOR
3
Directors AGAINST
8
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors
Against Analysis
Aliff has served since 2015, giving him full overlap with CWT's 3-year and 5-year underperformance; the stock returned -15.2% over 3 years while the compensation peer group median returned +14.7%, a gap of -29.9 percentage points that exceeds the 20pp threshold for negative absolute TSR, and the 5-year check confirms sustained underperformance (-40.9pp vs peers), so no mitigant applies.
Esque has served since 2018, giving her full overlap with CWT's material underperformance period; the 3-year gap of -29.9pp exceeds the 20pp policy threshold for negative absolute TSR, and the 5-year check shows continued underperformance (-40.9pp), confirming this is not a transient trough.
As Chairman, President, and CEO serving since 2013, Kropelnicki has the longest tenure overlap with CWT's underperformance; the policy applies the same TSR director trigger to executive directors, and the -29.9pp 3-year gap against peers (exceeding the 20pp threshold) combined with sustained 5-year underperformance (-40.9pp) warrants an AGAINST vote on him as a director, independent of the Say on Pay evaluation.
Krummel has served since 2010 and has the longest independent director tenure on the board, meaning he bears full accountability for the sustained underperformance; the 3-year and 5-year checks both trigger the policy threshold, and no mitigating circumstances apply.
Morris has served since 2019 as Lead Independent Director and has meaningful overlap with CWT's underperformance period; the 3-year gap of -29.9pp exceeds the 20pp threshold, and the 5-year check also confirms sustained underperformance, removing any mitigant that might otherwise apply.
Pottenger has served since 2017 and has full overlap with CWT's 3-year and 5-year underperformance periods; both the 3-year trigger (-29.9pp vs 20pp threshold) and the 5-year check (-40.9pp) fire without mitigation.
Snow has served since 2011 and has been on the board through the entirety of the underperformance period being evaluated; both the 3-year and 5-year checks trigger the policy threshold, confirming sustained underperformance with no mitigating factors.
Wagner has served since 2019 with meaningful overlap with CWT's underperformance; the 3-year gap of -29.9pp exceeds the 20pp threshold for negative absolute TSR, and the 5-year check also confirms sustained underperformance, leaving no basis for a mitigant.
For Analysis
Kightlinger joined the board in 2023, which is within the 24-month new director exemption under the policy, so the TSR underperformance trigger does not apply; he is exempt from the performance accountability screen at this time.
Maldonado joined in 2021, meaning her tenure covers less than the full 3-year underperformance window measured; the policy directs a flag but not an automatic AGAINST vote when tenure covers less than half the underperformance period, and given she joined relatively recently, an AGAINST vote is not warranted at this time.
Patton joined the board in 2023, placing him within the 24-month new director exemption; the TSR underperformance trigger does not apply to directors who have not yet had reasonable time to influence company performance.
CWT's stock returned -15.2% over 3 years while the compensation peer group median returned +14.7%, a gap of -29.9 percentage points that exceeds the 20pp policy threshold for companies with negative absolute TSR. The 5-year check confirms this is sustained underperformance (-40.9pp vs peers), not a transient trough. Eight of eleven directors are voted AGAINST based on meaningful tenure overlap with the underperformance period; three directors (Kightlinger, Patton, and Maldonado) are voted FOR due to the 24-month new director exemption or limited tenure overlap.
Say on Pay
✓ FORCEO
Martin A. Kropelnicki
Total Comp
$6,875,256
Prior Support
67%%
The 2025 Say on Pay vote fell to 67%, triggering this policy's prior-year response check, but the company demonstrated genuine responsiveness: it reached out to 22 of its largest shareholders, engaged with holders representing 38% of shares, added Total Shareholder Return and 3-year average Return on Equity as metrics to the long-term performance equity plan, retained a new independent compensation consultant (Korn Ferry), and raised the hurdles for the short-term bonus plan. The proxy discloses that 73% of CEO target compensation is variable and performance-based, which satisfies the pay mix threshold, and total CEO compensation of $6.875 million is consistent with a mid-cap regulated utility CEO benchmark. Because the company made meaningful, structural changes in direct response to the failed vote rather than cosmetic tweaks, the policy supports a FOR vote here.
Auditor Ratification
✓ FORAuditor
Deloitte & Touche LLP
Tenure
N/A
Audit Fees
N/A
Non-Audit Fees
N/A
The proxy filing text provided does not include the auditor fee table or tenure disclosure needed to evaluate the non-audit fee ratio or the 25-year tenure trigger; per policy, when tenure cannot be confirmed from available data, the default is FOR, and Deloitte & Touche LLP is a Big 4 firm appropriate for a $2.7B public utility.
Overall Assessment
The 2026 CWT ballot presents a mixed picture: the Say on Pay vote earns a FOR given genuine post-2025 reforms addressing the 67% failure, and auditor ratification defaults to FOR in the absence of fee data to trigger a concern, but eight of eleven director nominees receive AGAINST votes due to sustained and material stock price underperformance versus the company's own compensation peer group over both 3-year and 5-year periods. Only the three most recently added directors — Kightlinger, Patton, and Maldonado — avoid the TSR trigger based on limited tenure.
Compensation Peer Group
14 companies disclosed in 2026 proxy filing