Heightened Eligibility Thresholds for Shareholder Proposals: Modernization or Voter Suppression?

By Xinyi Mao December 17, 2021 by renholding

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.[1] Rule 14a-8, also called the shareholder proposal rule, governs when a company …

Wachtell Lipton Discusses ISS Final Voting Policies for the 2022 Proxy Season

By Andrew R. Brownstein, Andrea K. Wahlquist, Sabastian V. Niles, Justin C. Nowell and Ram Sachs December 14, 2021 by renholding

Institutional Shareholder Services (ISS) recently released its final U.S. voting policies, which largely track previously proposed policies and become effective for shareholder meetings held on or after February 1, 2022. Glass Lewis released its final U.S. voting policies for the …

Milbank Discusses SEC Guidance on Shareholder Proposals and the Way to Regulate Climate Change

By Neil Whoriskey November 24, 2021 by renholding

As a result of the SEC’s most recent Staff Legal Bulletin [1] (“SLB”), shareholder proposals that focus on a “significant social policy” will not be excludable simply because the policy issue is not, in fact, “significant” to the company receiving …

Wachtell Lipton Discusses SEC Staff’s Move to Limit Exclusion of “Social Policy” Shareholder Proposals

By David M. Silk, Trevor S. Norwitz, Sabastian V. Niles, Carmen X.W. Lu and Ram Sachs November 9, 2021 by renholding

The SEC Staff has issued revised guidance rescinding prior Staff Legal Bulletins addressing the exclusion of Rule 14a-8 shareholder proposals based on the social significance to a company, “micromanagement” or “economic relevance.” The changes will likely facilitate a larger number …

SEC Commissioner Lee on the Amendments to Rule 14a-8

By Allison Herren Lee September 25, 2020 by renholding

The final rules represent the capstone in a series of policies that will dial back shareholder oversight of management at the companies they own. Last year, the Commission adopted guidance on proxy advisors and proxy solicitation that made it more

…

SEC Commissioner Peirce on Shareholder Proposals under Exchange Act Rule 14a-8

By Hester M. Peirce September 25, 2020 by renholding

Thank you, Chairman Clayton. I support today’s amendments to certain procedural requirements and the resubmission thresholds under the shareholder proposal rule. While it can be difficult to discern the signal from the noise around today’s amendments, the reality of the

…

SEC Commissioner Roisman on Shareholder Proposals under Exchange Act Rule 14a-8

By Elad L. Roisman September 25, 2020 by renholding

Change is difficult. Especially when something has been a certain way for as long as you can remember. Twenty-two years have passed since the Commission last updated Rule 14a-8. In particular, the submission threshold was last substantively reviewed and amended

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SEC Chairman Clayton on Modernizing the Shareholder Proposal Framework

By Jay Clayton September 24, 2020 by renholding

Over the past three years, we have engaged in a number of retrospective reviews of the rules that implement our securities law framework. These reviews often, but not always, have yielded the unassailable conclusion that modernization is necessary and appropriate.

…

SEC Commissioner Crenshaw on Shareholder Proposals under Exchange Act Rule 14a-8

By Caroline A. Crenshaw September 24, 2020 by renholding

Today [September 23] the majority of the Commission is approving amendments to the procedures governing shareholder proposals. The amendments are described as a “modernization,”[1] designed to reduce costs for corporations. Even if I agreed that was necessary, I cannot

…

The New Civil Code: ISS and Glass Lewis as Lawmakers

By Neil Whoriskey July 28, 2020 by renholding

ISS and Glass Lewis have arrogated to themselves the power to make law, promulgating a civil code of astounding breadth and detail, ruling over decisions on board composition, director qualifications, term limits, majority voting standards, executive compensation, capital structure, poison …

Nuveen Previews 2020 Proxy Season: Environmental and Social Practices

By Nuveen Responsible Investing Team May 1, 2020 by renholding

Companies recognize the importance of environmental and social (E&S) factors and are giving consideration to a broader group of stakeholders to help mitigate risk. However, new regulations bring uncertainty to the future of environmental, social and governance (ESG) proposals.

The …

The Value of Shareholder Voting

By Ken Bertsch April 23, 2020 by renholding

Recent debates have sometimes obscured the value of shareholder voting, which the Council of Institutional Investors (CII) regards as a key element in the legitimacy and functioning of the corporate governance system in the United States and elsewhere.

A factor …

Peer Effects in Proxy Voting Decisions

By Jiekun Huang March 12, 2020 by renholding

Proxy voting decisions are characterized by strong strategic complementary relationships in the sense that the utility to a shareholder from voting in a particular manner increases with the extent that other shareholders vote in the same manner. Such complementarities arise …

Why the SEC Proposal to Regulate Proxy Advisors Is Flawed

By Ken Bertsch February 19, 2020 by renholding

[Editor’s Note: This and the piece that immediately follows offer a point/counterpoint on the SEC’s proxy advisor proposal.] The Council of Institutional Investors opposes the SEC’s proposal to create a new regulatory structure for proxy advisory firms.[1]…

Wachtell Lipton Discusses State Street’s Voting Push on Financially Material ESG Matters

By Martin Lipton, Sabastian V. Niles and Carmen X.W. Lu February 4, 2020 by renholding

In a letter to directors of public companies, State Street Global Advisors’ President and CEO, Cyrus Taraporevala, reiterated SSgA’s focus on “financially material” ESG issues as “a matter of value, not values.” He also confirmed that SSgA will go …

Cleary Gottlieb Discusses Shareholder Engagement Trends and Considerations

By Jeffrey Karp, Helena Grannis and Gaia Goffe January 24, 2020 by renholding

Shareholder engagement continues to be an important consideration for companies in communicating their long-term strategy and deepening relationships with their investors, and boards are becoming ever more involved in the process.

In PwC’s 2019 “Annual Corporate Directors Survey,” 51% of …

Cahill Gordon Discusses Glass Lewis and ISS 2020 Voting Guidelines

By Helene R. Banks, Geoffrey E. Liebmann, Ross Sturman, Joseph E. Cho and Tina M. Davis December 10, 2019 by renholding

Both Glass, Lewis & Co. (“Glass Lewis”) and Institutional Shareholder Services Inc. (“ISS”), the leading providers of corporate governance and proxy advisory services, have now published their 2020 proxy voting guidelines. The Glass Lewis guidelines[1] will take effect for …

Davis Polk Discusses SEC’s Proposed Rules on Proxy Advisers, Shareholder Proposals

By Joseph Hall, Sarah Solum, Ning Chiu, Betty Moy Huber and Paula Simpkins November 14, 2019 by renholding

On November 5, 2019, at an open meeting the SEC voted (3 to 2) to propose amendments to the proxy rules. The proposed amendments relate to regulating proxy advisory firms. The Commission also voted to propose amendments with regard to …

Nuveen Offers 2019 Proxy Season in Review

By Peter Reali and Anthony Garcia September 9, 2019 by renholding

The 2019 proxy season was marked by an increased willingness among shareholders to hold boards accountable on director elections, say- on-pay, and environmental, social and governance (ESG) shareholder proposals. For example, almost 5 percent of directors received less than 80 …

ISS Offers Overview of Vote Requirements at U.S. Meetings

By Kosmas Papadopoulos July 17, 2019 by renholding

At the general meeting of Tesla Inc. on June 11, 2019, two management proposals seeking to introduce shareholder-friendly changes to the company’s governance structure failed to pass, despite both items receiving support by more than 99.5 percent of votes cast …

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Columbia Law School's Blog on Corporations and the Capital Markets

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