In September 2020, the Securities and Exchange Commission amended Rule 14a-8 of the Securities Exchange Act to increase the eligibility requirements for a shareholder to submit proposals. Rule 14a-8, also called the shareholder proposal rule, governs when a company must include a shareholder proposal in its proxy statement. Passed by a 3-2 vote, the amendments have led to contentious debates about their potential impact on corporate governance.
Among other things, the September 2020 amendments make the following significant changes to the shareholder proposal process:
First, the SEC increases the ownership threshold for initial inclusion of … Read more