EASTMAN CHEMICAL (EMN)
Sector: Materials
2026 Annual Meeting Analysis
EASTMAN CHEMICAL · Meeting: May 7, 2026
Directors FOR
11
Directors AGAINST
0
Say on Pay
FOR
Auditor
AGAINST
Director Elections
Election of Directors
Alfonso has served since January 2011 (15+ years tenure); the 3-year TSR trigger fires vs. the peer group median (EMN -2.9% vs. peer median +10.8%, a gap of -13.7pp, which is below the 20pp threshold for negative absolute TSR), so no TSR-based AGAINST vote is warranted, and no other policy flags apply.
Audia joined in June 2025, well within the 24-month new-director exemption window, so he is fully exempt from the TSR trigger; no other policy flags apply.
Begemann has served since February 2011; the 3-year peer-group underperformance gap of -13.7pp does not exceed the 20pp threshold required to trigger an AGAINST vote for a company with negative absolute 3-year TSR, so no TSR flag applies and no other policy concerns are identified.
Butler joined in August 2022 (approximately 3.5 years ago); while his tenure overlaps the underperformance period, the 3-year peer-group gap of -13.7pp does not exceed the 20pp trigger threshold, so no AGAINST vote is warranted.
Costa has served as CEO and director since May 2013; the 3-year peer-group underperformance gap of -13.7pp does not exceed the 20pp threshold for a company with negative absolute 3-year TSR, so the TSR trigger does not fire, and no other policy flags apply independently of his Say on Pay evaluation.
Haynesworth joined in February 2023 (approximately 3 years ago); her tenure only partially overlaps the underperformance period, the peer-group gap of -13.7pp does not breach the 20pp threshold, and no other policy flags apply.
Holder has served since November 2011; the 3-year peer-group underperformance gap of -13.7pp does not exceed the 20pp trigger threshold for a company with negative absolute 3-year TSR, so no TSR flag applies and no other policy concerns are identified.
Hornbaker has served since September 2003; the 3-year peer-group underperformance gap of -13.7pp does not exceed the 20pp threshold, so no AGAINST vote is triggered, and her long financial background and CPA credentials make her well-qualified for her committee roles.
Mink joined in July 2018; the 3-year peer-group underperformance gap of -13.7pp does not exceed the 20pp trigger threshold, and she brings relevant specialty chemical industry expertise with no other policy flags.
O'Brien has served since February 2016; the 3-year peer-group underperformance gap of -13.7pp does not exceed the 20pp threshold, no overboarding concerns exist (one outside public board seat), and no other policy flags apply.
Slager joined in May 2024, which is within the 24-month new-director exemption window, making him fully exempt from the TSR trigger; he holds one outside public board seat and no other policy flags apply.
All eleven director nominees receive a FOR vote. Eastman's 3-year total shareholder return of -2.9% underperforms the disclosed compensation peer group median of +10.8% by 13.7 percentage points, which falls below the 20-percentage-point threshold required to trigger an AGAINST vote for companies with negative absolute 3-year TSR. No directors are overboarded, all audit committee members have demonstrated financial expertise, meeting attendance was 100% across the board, and no familial or independence concerns were identified. Two directors (Audia and Slager) are exempt from the TSR analysis entirely because they joined within the past 24 months.
Say on Pay
✓ FORCEO
Mark J. Costa
Total Comp
N/A
Prior Support
N/A
CEO total reported compensation of approximately $19.5 million is within an acceptable range for a large-cap Basic Materials company of Eastman's size and complexity, and the pay mix is strongly performance-oriented — 90% of target CEO pay is at-risk, with long-term equity comprising the dominant component split between performance share awards (60%), stock options (20%), and restricted stock units (20%). The annual incentive payout was appropriately restrained at 47% of target, reflecting the challenging operating environment, and long-term performance share awards paid out at 75% of target based on relative total shareholder return and return on invested capital, demonstrating that the incentive structure is working as intended by delivering below-target payouts when performance is below expectations. The company also maintains a meaningful clawback policy, prohibits hedging and pledging, requires robust stock ownership, and has engaged constructively with shareholders on compensation design, earning positive investor feedback — all of which support a FOR vote.
Auditor Ratification
✗ AGAINSTAuditor
PricewaterhouseCoopers LLP
Tenure
33 yrs
Audit Fees
$5,956,000
Non-Audit Fees
$1,352,000
PricewaterhouseCoopers has served as Eastman's auditor since 1993, giving it a tenure of approximately 33 years, which clearly exceeds our 25-year threshold. While the company notes that the lead engagement partner was rotated in 2026 and the audit committee actively oversees independence, partner rotation is not a substitute for firm-level independence concerns that arise from a multi-decade relationship. Non-audit fees of approximately $1.35 million (audit-related $125K + tax $929K + other $298K) represent about 22.7% of audit fees of $5.96 million, which is well within the 50% threshold and raises no independence concern on that dimension; the AGAINST vote is driven solely by the excessive tenure.
Stockholder Proposals
1 proposal submitted by shareholders
Proposal 5
Advisory Vote on Stockholder Proposal Regarding Lowering the Threshold for Calling Special Shareholder Meetings to 10%
Lowering the ownership threshold needed to call a special shareholder meeting — from whatever the current threshold is down to 10% — is a mainstream governance improvement that gives ordinary shareholders a meaningful ability to bring urgent matters before the company without waiting for the next annual meeting. This type of proposal aligns with shareholder interests by reducing the concentration of power needed to convene a meeting and is widely supported by institutional investors and governance advocates as a pro-shareholder structural change. There is no evidence of an ideological or political motivation behind this proposal, and absent strong evidence that a 10% threshold would be unduly disruptive, the governance benefit to shareholders supports a FOR vote.
Overall Assessment
The 2026 Eastman Chemical annual meeting ballot features eleven director nominees, all receiving FOR votes because the company's 3-year peer-group underperformance of 13.7 percentage points falls below the 20-point threshold needed to trigger AGAINST votes; Say on Pay also receives a FOR vote given a strongly performance-oriented pay structure with below-target payouts reflecting the tough 2025 environment. The principal exception is auditor ratification, which receives an AGAINST vote because PricewaterhouseCoopers has served as Eastman's auditor for approximately 33 years, well above the 25-year independence concern threshold established by this policy.
Compensation Peer Group
19 companies disclosed in 2026 proxy filing