Proxy fight at Harley-Davidson intensifies as investors split on board shakeup

Harley-Davidson faces investor showdown as proxy firms clash over board leadership and CEO succession.

Harley-Davidson motorcycles on display at the Oakland Harley-Davidson showroom in Oakland, California, on May 19, 2022. Photo by Justin Sullivan/Getty Images

By Anna Fadiah and Hayu Andini

A high-stakes proxy fight at Harley-Davidson has intensified ahead of the company's annual shareholder meeting, as leading proxy advisory firms offer conflicting recommendations that could shape the future direction of the iconic motorcycle manufacturer. Proxy fight at Harley-Davidson has taken center stage as shareholder activism collides with long-standing board leadership in a moment of reckoning for the company.

Institutional Shareholder Services (ISS), a major voice in corporate governance, recently urged shareholders to support Harley-Davidson’s current board members, arguing that activist investor H Partners has not provided compelling reasons to oust Chairman and CEO Jochen Zeitz and board directors Thomas Linebarger and Sara Levinson. All three have been on the board for at least 17 years and are central figures in the company’s leadership.

However, a sharply different assessment came from Glass Lewis, another top proxy adviser. In its report released Tuesday, Glass Lewis contended that the directors in question had presided over underwhelming shareholder returns, and their removal would not adversely impact the board’s performance or governance. Echoing this sentiment, Egan-Jones Proxy Services also recommended withholding votes from the three directors, aligning more closely with H Partners’ campaign.

These contrasting positions have injected fresh drama into the ongoing proxy fight at Harley-Davidson, which is set to be resolved during the company’s annual meeting on May 14. The dispute over board leadership comes at a precarious moment for Harley-Davidson, which is grappling with declining sales, a tough macroeconomic environment, and internal leadership tensions.

The seeds of the proxy battle were sown when Jared Dourdeville, H Partners’ former representative on the board, resigned to mount a challenge against the current leadership. In filings with the Securities and Exchange Commission, Dourdeville voiced serious concerns over Harley’s execution of its long-term strategy and pointed to Jochen Zeitz as the principal source of the company's stagnation.

While Zeitz has announced his intention to step down as CEO later this year, Dourdeville insists that neither Zeitz nor his two long-serving board allies should play a role in selecting his successor. According to H Partners, doing so would only perpetuate the very culture of complacency and underperformance that they argue has plagued the company in recent years.

Harley-Davidson defends its track record

In response, Harley-Davidson has characterized the proxy fight as a form of “sour grapes,” alleging that it began only after the board rejected H Partners’ preferred CEO candidate. The company has defended its recent performance, acknowledging the 35% decline in share value over the past year but asserting that its results are more favorable than those of many peers in the big-ticket recreational goods sector.

Supporting this view, ISS concluded that the boardroom conflict is proving to be a needless distraction during the critical process of CEO succession. By contrast, Glass Lewis criticized the board for avoiding accountability, suggesting that structural changes are necessary to reinvigorate governance and align leadership with shareholder interests.

The proxy fight at Harley-Davidson has attracted commentary from key industry stakeholders. On Tuesday, the National Powersports Dealer Association (NPDA), which claims to represent nearly 170 of Harley’s approximately 570 U.S. dealers, publicly threw its support behind H Partners. In turn, Harley-Davidson dismissed the NPDA’s legitimacy, noting that it officially engages with a different council of dealership representatives.

Shareholders themselves appear divided. Baltimore-based investor Phil VanderHeyden, who owns roughly 300 shares in the company, voiced frustration with Jochen Zeitz’s leadership and said he intends to vote with H Partners, viewing it as a necessary check on management.

“I think it’s useful to fire a shot across the bow of management,” VanderHeyden said, underscoring the growing sentiment among investors who feel sidelined by the board’s long tenure and insular decision-making.

Jason Bremer, who owns three Harley dealerships in Minnesota and Texas and is also a shareholder, expressed ambivalence. While he hasn’t yet made a decision on how to vote, he criticized the public nature of the dispute.

“It’s like letting the customers see mom and dad fight,” Bremer remarked. “What good does it really do?”

The road ahead: Uncertainty and leadership transition

What makes this proxy fight particularly consequential is the timing. Harley-Davidson is in the midst of navigating a broader transition in leadership, with the impending retirement of Zeitz set to mark the end of an era. At stake is not only the company’s direction but the power to appoint the next leader—an individual who will inherit both the company’s legacy and its current challenges.

Though Harley has claimed that internal performance remains solid given the economic backdrop, the growing chorus of criticism from shareholders and advisers may cast a long shadow over the board’s ability to lead effectively.

Meanwhile, the competing views of ISS, Glass Lewis, and Egan-Jones underscore a deeper question: should Harley-Davidson remain loyal to longstanding leadership, or embrace the shakeup that H Partners argues is necessary for revitalization?

The proxy fight at Harley-Davidson is more than just an internal board dispute—it reflects a broader trend of increased shareholder activism in American corporate governance. With activist investors more empowered than ever and proxy advisory firms willing to take opposing sides, companies are facing mounting pressure to prove that board members are not merely symbolic stewards but active architects of long-term value.

For Harley-Davidson, a brand that evokes passion and loyalty among its riders, the boardroom drama threatens to tarnish that image. Whether the company can steer out of this turbulence may well depend on the choices shareholders make in the days to come.

Regardless of the outcome, the May 14 vote will serve as a referendum on leadership, accountability, and the role of activist investors in reshaping public companies. The proxy fight at Harley-Davidson has become a test case for how legacy firms adapt—or fail to adapt—in the face of evolving market and governance expectations.

As proxy battles become more frequent and contentious, Harley-Davidson’s experience offers a cautionary tale: legacy and reputation alone may not be enough to weather storms when shareholders believe bold change is overdue.