Separate Chair & CEO | Interfaith Center on Corporate Responsibility

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<h4>Resolution Details</h4>
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<strong>Company:</strong>
<p>Cummins Inc.</p>
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<strong>Year:</strong>
<p>2026 </p>
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<strong>Issue Area:</strong>
<p>Corporate Governance </p>
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<strong>Focus Area:</strong>
<p>Independent Board Chairs </p>
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<strong>Status:</strong>
<p>Filed</p>
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<h2>Resolution Text</h2>
<p><strong>RESOLVED</strong>: Shareholders request that the Board of Directors adopt an enduring policy, and amend the governing documents as necessary including the Corporate Governance Guidelines in order that 2 separate people hold the office of the Chairman and the office of the CEO as soon as possible.</p>
<p><strong>SUPPORTING STATEMENT</strong>:</p>
<p dir=”ltr”>The Chairman of the Board shall be an Independent Director. An independent Lead Director shall not be a substitute for an independent Board Chairman.<br> <br>The Board shall have the discretion to select an interim Chairman of the Board, who is not an Independent Director, to serve while the Board is required to seek an Independent Chairman of the Board on an accelerated basis. This policy could be phased in when there is a contract renewal for our current CEO or for the next CEO transition although it is better to adopt it now to obtain the maximum benefit.</p>
<p dir=”ltr”>An independent Board Chairman at all times improves corporate governance by bringing impartiality, objective oversight, and external expertise to board decisions, mitigating conflicts of interest, enhancing transparency, and boosting shareholder confidence. </p>
<p dir=”ltr”>This detached perspective allows the chairman to focus on shareholder interests, strengthen management accountability, and provide critical checks and balances, ultimately contributing to long-term sustainability and credibility. </p>
<p dir=”ltr”>An independent Board Chairman could also help Cummins (CMI) deal with headwinds like those that emerged in 2025:</p>
<p dir=”ltr”>A 15% rise in the CMI stock price between August and November 2025 leaves CMI with underwhelming appreciation potential over the next 3 to 5 years.<br><br>North American heavy and medium-duty truck demand saw a sharp decline throughout 2025. </p>
<p dir=”ltr”>In Q3 2025, Cummins’ EPS fell short of analyst expectations, resulting in a negative surprise.</p>
<p dir=”ltr”>Due to growing economic and regulatory uncertainty and volatile tariffs, CMI announced it would not be providing an outlook for revenue or profitability for the remainder of 2025, which raised shareholder concerns.<br><br>CMI recorded $240 million in non-cash charges related to its electrolyzer business, reflecting lower demand expectations and reduced government incentives for green hydrogen adoption in the U.S.</p>
<p dir=”ltr”>Increased tariffs negatively impacted profitability throughout 2025, as CMI worked to recover these costs through price increases.</p>
<p dir=”ltr”>Some mechanics and owners of the new 2025 Ram 2500 and 3500 trucks were concerned about potential issues with the updated 6.7L Cummins engine, specifically potential problems with the valve train and roller lifters, which had been an issue in previous models.</p>
<p dir=”ltr”>UAW union workers at some Cummins facilities struck in mid-2025 over contract negotiations and concerns, leading to temporary operational disruptions. <br><br>A class-action lawsuit accusing Cummins and FCA US of installing illegal emissions defeat devices in diesel engines continued to progress. This follows a prior major settlement with the EPA over similar claims in earlier engines.</p>

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<h3>Lead Filer</h3>
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<div class=”views-field views-field-nothing”><span class=”field-content”> John Chevedden</span></div><div class=”views-field views-field-title views-field-field-shareholder”><span class=”field-content”>Chevedden Corporate Governance</span></div>
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