{ "docId": "019dd923-622b-71dc-a6d9-c007c91e862b", "docSlug": "28a425ed69eb", "documentTitle": "Darden Restaurants, Inc. (DRI)", "authorId": "03_Starboard_Value", "authorName": "Starboard Value", "documentKindSlug": "activist-deck", "documentKindLabel": "Activist deck", "sourceTypeSlug": "activist_investor", "sourceTypeLabel": "Activist investor", "presentationDate": "2014-09-11 00:00:00", "orientation": "landscape", "aspectRatio": 1.3333334, "pageNumber": 28, "pageCount": 294, "prevPage": 27, "nextPage": 29, "slideType": "villain_critique", "function": "name_villain", "density": "dense", "nDataPoints": 1, "notes": "Uses a 'past behavior' argument to discredit incumbent board nominees.", "elementsJson": [ "headline_text", "paragraph", "bullet_list" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622b-71dc-a6d9-c007c91e862b/28", "deckHref": "/decks/019dd923-622b-71dc-a6d9-c007c91e862b", "deckJsonHref": "/decks/019dd923-622b-71dc-a6d9-c007c91e862b.json", "deckAnchorHref": "/decks/019dd923-622b-71dc-a6d9-c007c91e862b#slide-28", "components": [ { "bbox": { "h": 0.05, "w": 0.96, "x": 0.02, "y": 0.86 }, "kind": "callout", "text": "The best predictor of future behavior is past behavior...", "attrs": null, "subkind": "primary", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ad3508af-9efe-4081-9d63-0cf3f2844fd5", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.06, "w": 0.92, "x": 0.04, "y": 0.44 }, "kind": "list", "text": "The Company’s actions, including the sale of Red Lobster, its lack of capital discipline, and its excessive spending on corporate luxuries, have jeopardized the safety of Darden’s investment grade rating and dividend.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0831db4c-9c05-4533-906e-75ff5baa2fec", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.06, "w": 0.92, "x": 0.04, "y": 0.26 }, "kind": "list", "text": "The current Board members and management embody a “corporate-centric” culture and have forgotten the ways of Bill Darden and Joe Lee, true restaurant operators and leaders.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "30777e17-2307-4719-a1f2-55d5d34364b0", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.82, "x": 0.14, "y": 0.68 }, "kind": "list", "text": "3 of the 4 incumbent nominees were on Darden’s Compensation Committee; 2 were on the Nomination and Governance Committee; None of the Company’s nominees have hired an external CEO; All of the Company’s nominees voted in favor of the Red Lobster sale", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "33f7f03a-0ee4-4aac-b6f0-b17dabceb4eb", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.03, "w": 0.92, "x": 0.04, "y": 0.52 }, "kind": "list", "text": "The Board has failed to establish incentives that promote hard work and lead to management success and shareholder returns.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "6d11e949-78e1-4b57-bf70-49a0efff1215", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.08, "w": 0.92, "x": 0.04, "y": 0.16 }, "kind": "paragraph", "text": "As with any business, especially an operationally focused customer service business, success begins with great leaders. We believe Darden’s Board and its proposed slate are not equipped to lead Darden through Olive Garden’s revival.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "9a09c8e8-9efa-4996-ae5a-f8f18749b01c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.05, "w": 0.45, "x": 0.04, "y": 0.94 }, "kind": "source-note", "text": "Source: Company filings. (1) In fiscal 2014, Darden underperformed its Proxy Group by 19% and underperformed its Closest Direct Peers by 18%. (2) See slide 49.", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "dc42be56-b64e-4423-acc8-2ddb68fa189a", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.92, "x": 0.04, "y": 0.04 }, "kind": "title", "text": "How have Darden’s management team and Board members contributed to this massive underperformance?", "attrs": null, "subkind": "headline", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "49f82c2c-0967-4ad4-b88e-1a79f656f997", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [ { "name": "villain_critique", "slug": null, "matchId": "f01796f5-201d-4bf4-b379-322b924d6edf", "evidence": "The slide systematically attacks the credibility of the incumbent board members.", "confidence": 0.9 } ], "arcBeats": [ { "to": 28, "from": 28, "beatId": "6332859a-d0f0-474f-9920-cf88d67e287d", "arcName": "Problem-Agitate-Solution", "arcSlug": "problem-agitate-solution", "beatName": "Villain Critique", "beatSlug": null, "evidence": "The document critiques Darden's management and board, portraying them as villains who have destroyed shareholder value.", "position": 1, "confidence": 0.8, "parentBeatName": null, "parentBeatSlug": null } ], "loops": [ { "to": 36, "from": 25, "name": "Cost Of Inaction", "slug": "27-cost-of-inaction", "bestFor": "Urgent budget requests, compliance, risk mitigation", "matchId": "5982850d-92b9-4c39-bf8a-3ccd6e70b8ec", "evidence": "The document emphasizes the need for change at Darden, highlighting the costs of inaction and the potential benefits of Starboard's plan.", "position": 0, "objective": "Highlight the costs of inaction and the need for change at Darden", "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point", "confidence": 0.7, "description": "Quantify what happens if the audience does nothing" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }