TORO (TTC)
Sector: Industrials
2026 Annual Meeting Analysis
TORO · Meeting: March 17, 2026
Directors FOR
1
Directors AGAINST
2
Say on Pay
FOR
Auditor
FOR
Director Elections
Election of Directors: Dianne C. Craig, Eric P. Hansotia and D. Christian Koch for a term of three years ending at the 2029 Annual Meeting of Stockholders
Against Analysis
Mr. Hansotia has served since 2022, giving him meaningful tenure overlap with TTC's severe stock underperformance; TTC's 3-year price return of -8.2% trails the PSCI ETF (the appropriate benchmark for a farm and heavy construction machinery company) by approximately 86 percentage points, far exceeding the 30-point threshold required to trigger a no-vote for directors with negative absolute TSR; the 5-year return of -2.2% also remains negative with a gap well above the threshold, so the 5-year mitigant does not apply, confirming this is sustained underperformance rather than a temporary trough.
Mr. Koch has served on the TTC board since 2016, giving him full overlap with the 3-year underperformance period; TTC's stock lost 8.2% over three years while the PSCI ETF (the correct benchmark for TTC's industry) gained 78%, a gap of roughly 86 percentage points that far exceeds the 30-point trigger threshold applicable when absolute TSR is negative; the 5-year return of -2.2% is also negative and the gap versus PSCI likewise exceeds the threshold, so the 5-year mitigant does not soften the outcome.
For Analysis
Ms. Craig joined the board in 2024, which is within the 24-month new-director exemption window, so she is fully exempt from the TSR underperformance trigger; she brings deep executive leadership experience from Ford/Lincoln with no overboarding, attendance, or independence concerns.
Of the three nominees, Ms. Craig is exempt from the TSR trigger as a director appointed in 2024 and warrants a FOR vote; Messrs. Hansotia and Koch both have meaningful board tenure overlapping with TTC's severe 3-year and 5-year stock underperformance versus the PSCI ETF (the appropriate benchmark for Farm and Heavy Construction Machinery companies per policy), triggering AGAINST votes on each.
Say on Pay
✓ FORCEO
Richard M. Olson
Total Comp
$8,436,478
Prior Support
92%%
CEO Richard Olson's total reported compensation of $8.4 million is within a reasonable range for a $9.3 billion market-cap industrial company, and the prior say-on-pay vote received over 92% support signaling broad shareholder endorsement of the pay structure. The pay mix is heavily weighted toward variable, performance-linked compensation — approximately 85% of the CEO's target pay is at-risk through annual cash incentives and long-term equity awards — which meets and exceeds the policy's 50-60% variable pay threshold. Incentive payouts for fiscal 2025 reflected actual performance: annual cash incentives paid at only 81.6% of target and the three-year performance share award paid at just 22.2% of target, demonstrating that the plan's performance conditions are real and functioning as intended, with the company's clawback policy providing additional governance protection.
Auditor Ratification
✓ FORAuditor
KPMG LLP
Tenure
N/A
Audit Fees
$2,285,373
Non-Audit Fees
$199,378
Non-audit fees (tax fees of $187,378 plus other fees of $4,000 plus audit-related fees of $8,000 = $199,378) represent approximately 8.7% of audit fees ($2,285,373), well below the 50% threshold that would raise independence concerns; KPMG is a Big 4 firm appropriate for TTC's size; auditor tenure is not explicitly disclosed in the proxy so no tenure trigger fires per policy; no material restatements were identified.
Overall Assessment
TTC's 2026 ballot presents a mixed outcome: the Say on Pay and auditor ratification both warrant FOR votes given a well-structured pay program with demonstrated performance linkage and clean audit fee ratios, but two of the three director nominees (Hansotia and Koch) warrant AGAINST votes due to TTC's severe and sustained stock underperformance — down 8.2% over three years versus the PSCI ETF's gain of 78%, a gap of 86 percentage points that far exceeds the policy trigger threshold. New director Craig is exempt from the TSR trigger given her 2024 appointment and receives a FOR vote.