An investor is asking other investors to help him oust the Genworth Financial directors who serve on the Genworth board compensation committee.
Scott Klarquist — the president, CEO and chief investment officer at Seven Corners Capital Management — announced the effort in an open letter to Genworth shareholders that was filed Wednesday with the SEC.
Shareholders should vote against the compensation committee members because Genworth is paying its top executives and directors too much, Klarquist said in the letter.
"I believe Genworth's senior executive compensation makes little sense," Klarquist said.
Tom McInerney, Genworth's CEO, earned $8.5 million in cash compensation awards, stock awards and other compensation in 2021, and he and other Genworth senior executives and directors are paid as if they were associated with insurers, such as CNO Financial Group and Unum Group, with an average "market cap," or total stock value, that's about five times higher than Genworth's market cap, Klarquist said.
Klarquist does not compare executive or director compensation levels based on variables such as revenue or asset size.
Klarquist said in the letter that he is the beneficial owner of 30,100 shares of Genworth's Class A common stock.
He also intends to file a preliminary proxy statement and proxy card to be used to solicit votes at Genworth's annual meeting, according to a note at the bottom of his open letter. Genworth plans to start a virtual-only annual meeting at 9 a.m. Eastern Daylight Time May 19.
Klarquist was not immediately available for comment.
Genworth said in a separate filing that Klarquist has told it that he intends to run for a seat on the Genworth board.
"You may receive proxy solicitation materials from Mr. Klarquist," Genworth said. "We are not responsible for the accuracy of any information contained in any solicitation materials filed or disseminated by, or on behalf of, Mr. Klarquist or any other statements that he may otherwise make."
The Genworth board is recommending unanimously that shareholders vote for the board's own nominees and ignore Klarquist's materials.
Shareholders can revoke any Klarquist proxy cards they have sent by calling Genworth, notifying the company through the internet, returning a later-dated proxy card, or attending the Genworth annual meeting.
Genworth was not immediately available for comment.
