The Council of Institutional Investors has sent a letter to William Hinman, director of Corp Fin, raising objections to the staff’s treatment of a recent shareholder proposal. The staff permitted the company, the AES Corporation, to exclude a shareholder proposal submitted by John Chevedden that sought to reduce the threshold required for shareholders to call a special meeting from 25% to 10%. The basis for exclusion was Rule 14a-8(i)(9), which allows a shareholder proposal to be excluded if it directly conflicts with a management proposal to be submitted for a vote at the same shareholders meeting. In its letter, CII charged the company with “gaming the system to exclude a vote on a legitimate proposal that receives substantial shareholder support when it is voted on at other companies – to reduce the threshold for calling a special meeting,” and urged the SEC to revisit, once again, its approach to Rule 14a-8(i)(9).
As proxy access bylaws have continued to proliferate—with 60% of the S&P 500 now having adopted some form of proxy access provisions—the Council of Institutional Investors has decided that the time is right to update its 2015 best practices guide. In particular, the 2017 update addresses practices that, while viewed by companies as designed to ensure the legitimate and appropriate use of proxy access, are viewed by CII as impairing the ability of shareholders to use proxy access. But will companies be guided by CII’s advice?
by Cydney Posner In case you missed it, Gretchen Morgenson’s column in the Sunday NYT railed against virtual-only annual meetings, which according to her data (provided by Broadridge), have increased in number from 21 in 2011 to 154 in 2016. And joining in the condemnation of the practice was NYC […]
by Cydney Posner A new analysis from the Council of Institutional Investors, announced on October 31, reports a relatively high proportion of “zombie directors” remaining on corporate boards. (The date was not lost on CII: the press release was called a Halloween media advisory.) As you probably know, a “zombie […]
by Cydney Posner For many years, annual meetings of shareholders have been viewed as increasingly moribund rituals of corporate governance, as fewer and fewer shareholders are able or willing to overcome the logistical and financial burdens of attendance in person. As a result, in many cases, meetings have evolved into […]