MIDDLESEX WATER (MSEX)
Sector: Utilities
2026 Annual Meeting Analysis
MIDDLESEX WATER · Meeting: May 19, 2026
Directors FOR
1
Directors AGAINST
3
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors
Against Analysis
Dr. Bershad has served since 2020 and thus bears full accountability for the stock's severe underperformance: Middlesex Water's shares fell 27.3% over three years while the utilities sector ETF (XLU) gained 45.3%, a gap of 72.6 percentage points that far exceeds the 30-point trigger threshold for companies with negative absolute returns; the five-year picture is equally poor (-26.1% vs. XLU's gains), so the 5-year mitigant does not apply.
Mr. Cosgrove has served on the board since 2010 and is fully accountable for the company's performance track record; Middlesex Water's stock lost 27.3% over three years while the utilities sector ETF (XLU) gained 45.3%, a 72.6-percentage-point gap that triggers a vote against under the policy, and the five-year return is similarly negative, so no long-term mitigant applies.
Mr. McKoy joined the board in 2021, giving him more than 24 months of tenure and full exposure to the underperformance period; the stock's 72.6-percentage-point lag behind the XLU utilities ETF over three years with a negative absolute return triggers a vote against, and the five-year record provides no relief because returns remain deeply negative over that horizon as well.
For Analysis
Mr. Hoglund joined the board in 2026 and has been a director for less than 24 months, making him exempt from the TSR underperformance trigger under our policy; he brings strong relevant credentials as a retired CFO of Consolidated Edison with deep utility finance expertise, and there are no overboarding, attendance, independence, or other concerns.
Three of the four director nominees (Bershad, Cosgrove, McKoy) face vote-against determinations because Middlesex Water's stock has badly trailed the XLU utilities ETF — down 27% while the ETF gained 45% over three years, a 72.6-point gap that far exceeds the policy threshold. The newly appointed Robert Hoglund is exempt from the TSR trigger given his recent appointment and receives a FOR determination.
Say on Pay
✓ FORCEO
Nadine Leslie
Total Comp
$1,906,024
Prior Support
86.4%%
CEO Nadine Leslie received total compensation of approximately $1.9 million in 2025, which is reasonable for a CEO of a regulated water utility with roughly $1 billion in market capitalization, and prior shareholder support was strong at 86.4%. The pay structure is well-designed: a meaningful share of total pay is variable — base salary of $754,000 (about 40% of total), a new cash bonus program tied to net income and operational goals, and restricted stock tied to earnings per share and capital investment delivery — satisfying the policy's requirement that at least 50-60% of pay be performance-linked. While the company's stock has underperformed the XLU utilities ETF significantly over three years, the incentive pay levels themselves are not above benchmark in a way that triggers a pay-for-performance misalignment concern, and the compensation committee introduced meaningful new performance conditions (the short-term incentive program) in 2025, demonstrating responsiveness to governance best practices. A clawback policy compliant with Dodd-Frank is in place and prior say-on-pay support comfortably exceeded 70%, so no override conditions are met.
Auditor Ratification
✓ FORAuditor
PricewaterhouseCoopers LLP
Tenure
1 yrs
Audit Fees
$854,273
Non-Audit Fees
$2,000
PricewaterhouseCoopers LLP was appointed as the company's new auditor for fiscal year 2025, replacing Baker Tilly after a competitive selection process that began in October 2024, so tenure is approximately one year and well below the 25-year concern threshold. Non-audit fees of $2,000 (a software license) represent only 0.2% of audit fees of $854,273, far below the 50% threshold that would raise independence concerns. PwC is a Big Four firm fully appropriate for a company of Middlesex Water's size and complexity.
Overall Assessment
The 2026 Middlesex Water annual meeting ballot contains three proposals: director elections, say-on-pay, and auditor ratification. The primary governance concern is the company's severe stock underperformance — shares lost 27% over three years while the XLU utilities ETF gained 45% — which triggers vote-against determinations for the three longer-tenured director nominees (Bershad, Cosgrove, McKoy), while the newly appointed Hoglund and the say-on-pay and auditor proposals all receive FOR determinations.
Compensation Peer Group
3 companies disclosed in 2026 proxy filing