ELANCO ANIMAL HEALTH INC (ELAN)
Sector: Health Care
2026 Annual Meeting Analysis
ELANCO ANIMAL HEALTH INC · Meeting: May 21, 2026
Directors FOR
5
Directors AGAINST
0
Say on Pay
AGAINST
Auditor
FOR
Director Elections
Election of five director nominees to serve one-year terms
Anand has served since 2018 and ELAN's 3-year price return of +156.4% outperforms the peer group median of -13.1% by +169.5 percentage points, far above the 50pp underperformance threshold required to trigger a vote against, so no TSR concern applies; she also has strong financial expertise as a former KPMG audit partner and chairs the Audit Committee.
Herendeen has served since December 2020 and the company's strong 3-year outperformance of peers (+169.5pp versus a 50pp threshold) means the TSR trigger does not apply; his deep CFO experience in animal health and life sciences makes him highly qualified for his Audit and Finance committee roles.
Harrington has served since 2018 and ELAN's strong stock outperformance versus its peer group means the TSR underperformance trigger does not apply; his legal, regulatory, and governance expertise from three decades at Eli Lilly is highly relevant to Elanco's business.
Kurzius has served since 2018 and the company's 3-year TSR dramatically outperforms the peer group median, so no TSR concern applies; as independent Board Chairman and former CEO of a Fortune 500 consumer goods company, he brings strong leadership and operational experience to the role.
McDonald has served since March 2019 and ELAN's peer-relative TSR outperformance of +169.5pp is well above the 50pp threshold needed to trigger a vote against; his digital, technology, and business leadership experience is relevant to Elanco's omnichannel and digital transformation strategy.
All five director nominees (two Class I, three Class II) pass the TSR screening because Elanco's 3-year price return of +156.4% outperforms the company-disclosed peer group median of -13.1% by +169.5 percentage points, far exceeding the 50-percentage-point threshold that would be required to trigger a vote against. No overboarding, attendance, independence, or qualification concerns were identified for any nominee.
Say on Pay
✗ AGAINSTCEO
Jeffrey Simmons
Total Comp
$14,925,756
Prior Support
53.5%%
The prior year's say-on-pay vote received only 53.5% support, well below the 70% threshold that requires visible structural changes before a FOR vote can be supported. While the company engaged shareholders and made changes to the 2026 program (adding an rTSR metric and a sales growth modifier), these changes apply prospectively to 2026 pay — the 2025 program being voted on here still lacks relative TSR alignment and retains a short 2-year performance period for equity awards, which falls short of the preferred 3-to-5-year window for long-term incentives. The CEO's total reported compensation of approximately $14.9 million is not itself disqualifying, but the combination of a failed prior vote and insufficient structural remediation of the exact issues shareholders flagged — short performance periods, single-metric equity awards, and no market-relative performance condition in 2025 — warrants a vote against.
Auditor Ratification
✓ FORAuditor
Ernst & Young LLP
Tenure
9 yrs
Audit Fees
$11,250,040
Non-Audit Fees
$13,931
EY has served as Elanco's auditor since 2017 (approximately 9 years), well below the 25-year tenure threshold that would raise independence concerns. Non-audit fees of $13,931 represent less than 0.2% of audit fees of $11,250,040, far below the 50% ratio that would trigger a vote against. EY is a Big 4 firm appropriate for a company of Elanco's size and complexity, and no material financial restatements were identified.
Overall Assessment
The 2026 Elanco annual meeting presents three standard proposals: a director election slate that passes all policy screens due to the company's exceptional 3-year stock outperformance versus peers, an auditor ratification with no independence or fee concerns, and a say-on-pay vote that warrants a vote against because last year's say-on-pay received only 53.5% shareholder support and the 2025 compensation program being ratified this year did not yet incorporate the structural improvements (relative TSR metric, longer performance periods) that shareholders requested. The ballot contains no stockholder proposals.
Compensation Peer Group
18 companies disclosed in 2026 proxy filing