Tag Archives | SEC

Proxy Access: Keith Higgins Speaks on SEC’s (i)(9) Review

Broc Romanek

Broc Romanek, Editor of TheCorporateCounsel.net & CompensationStandards.com

Yesterday (2/10/2015), Corp Fin Director Keith Higgins delivered this interesting speech entitled “Rule 14a-8: Conflicting Proposals, Conflicting Views.” There are some really interesting things in this speech on counterproposals, etc., although there isn’t much that helps those companies grappling with proxy access shareholder proposals this proxy season (but there is some, such as #6 below). Here’s some notables from Keith’s speech: Continue Reading →

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Increase Retail Shareholder Participation in Proxy Process

recommendedAs I have been mentioning, I will be on a panel at the 2/19 SEC Roundtable discussing how to increase retail shareholder participation in the proxy process. It is the night before the event; so I’m trying to boil it all down, knowing I’ll probably only get a few minutes to say anything. The previous posts are all well and good about things that should be done. I tried to focus on what the SEC could do to help, since they are holding the event. Now that our panel is about to convene, I’m just going to mention what could prompt participation, whether or not it requires anything from the SEC.

From the SEC notice: This panel will focus on strategies for increasing retail shareholder participation in the proxy process. The panel will discuss how technology – by providing better access to information or easier means of voting – might affect retail participation. In addition, the panel will discuss whether the format of disclosure could be improved to increase the engagement of shareholders and how the mechanics of voting could be improved to affect retail shareholder participation.  Continue Reading →

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Retail Shareholder Proxy Participation: Part 3 – VIFs & CITs

elephant in the roomI will be on a panel at the 2/19 SEC Roundtable discussing how to increase retail shareholder participation in the proxy process. The SEC agenda is in bold italics.  Our thoughts on VIFs and CITs are in normal type. Part 1 is here. Part 2 here.

This panel will focus on strategies for increasing retail shareholder participation in the proxy process. The panel will discuss how technology – by providing better access to information or easier means of voting – might affect retail participation. In addition, the panel will discuss whether the format of disclosure could be improved to increase the engagement of shareholders and how the mechanics of voting could be improved to affect retail shareholder participation. Continue Reading →

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Retail Shareholder Proxy Participation: Part 2 – CDV

MoxyVote: The closest we got to open and robust CDV

Moxy Vote: The closest we got to open and robust CDV

The last set of questions for panel at the 2/19 SEC Roundtable deal with client directed voting (CDV). Below are a few thoughts with the help of readers. I welcome further comments. The SEC agenda and questions are in bold italics.  Our thoughts are in normal type. Part 1 is here.

This panel will focus on strategies for increasing retail shareholder participation in the proxy process. The panel will discuss how technology – by providing better access to information or easier means of voting – might affect retail participation. In addition, the panel will discuss whether the format of disclosure could be improved to increase the engagement of shareholders and how the mechanics of voting could be improved to affect retail shareholder participation. 

The SEC raises several questions in their last group of questions for the panel on client directed voting, which I discuss below. Continue Reading →

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Retail Shareholder Participation in the Proxy Process: Part 1

Simplified Proxy Voting Diagram

Simplified Proxy Voting Diagram

As mentioned before, I will be on a panel at the 2/19 SEC Roundtable discussing how to increase retail shareholder participation in the proxy process. I’ve been collecting a few thoughts with the help of readers. Time is a major constraint, so I will need to prioritize my main points and will probably end up with a few bullet points by the time Thursday rolls around. In the meantime, I welcome further comments. The SEC agenda is in bold italics.  Our thoughts are in normal type. Continue Reading →

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SEC Panelists & Agenda for Proxy Voting Roundtable

Seal of SECThe Securities and Exchange Commission today announced the agenda and panelists for its February 19 roundtable on ways to improve the proxy voting process.

The roundtable, announced in January, will begin at 9:30 a.m. and will be divided into two panels.  Participants on the first panel will focus on the state of contested director elections and whether changes should be made to the federal proxy rules to facilitate the use of universal proxy ballots by management and proxy contestants.  Participants also will discuss the state law, logistical, and disclosure issues presented by a possible universal proxy ballot process. Continue Reading →

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Recommendations to SEC-IAC on Proxy Access

Proxy Access Road Building (photo by Erik Johansson)

Proxy Access Road Building (photo by Erik Johansson)

I’m delighted to see “Discussion of Proxy Access” (11:05-12:05 p.m.) as one of the items on the agenda for the SEC’s Investor Advisory Committee (SEC-IAC) at the upcoming February 12th meeting. I discuss two recommendations below. Take Action: Please submit your own and paste into comments below. See comments submitted.

Proxy Access: Rule 14a-11

In light of CFA Institute’s Proxy Access in the United States: Revisiting the Proposed SEC Rule with the following findings, it is time to revisit the SEC’s overturned Rule 14a-11. Continue Reading →

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SEC to Hold Proxy Voting Roundtable: I’m on Panel Two

Seal of SEC(1/27/2015) The Securities and Exchange Commission announced that it will host a roundtable on February 19 to explore ways to improve the proxy voting process.  The roundtable, which will be held at the SEC’s Washington, D.C. headquarters, will focus on universal proxy ballots and retail participation in the proxy process. I will be a member of the second panel. I invite readers to help me by sharing your ideas.

Proxy voting is important to both investors and companies.  The ability to vote allows investors to make their views known to the company’s management and to participate effectively at annual or special meetings. Thus, the proxy voting process should be robust, effective and workable. Continue Reading →

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SEC Withdraws No-Action: Rule 14a-8(i)(9) Suspended

Seal of SEC

The SEC has essentially suspended Rule 14a-8(i)(9) Conflicts with company’s proposal. Shareowners at Whole Foods Market and at many other companies have scored a huge victory.

Last Friday the SEC issued the following:

Statement from Chair White Directing Staff to Review Commission Rule for Excluding Conflicting Proxy Proposals

Chair Mary Jo White

Jan. 16, 2015 The Commission’s proxy rules enable shareholders to submit proposals for inclusion in a company’s proxy materials for a vote at a shareholder meeting, subject to certain procedural and substantive exclusions.  One of the exclusions, Exchange Act Rule 14a-8(i)(9), allows a company to exclude a shareholder proposal that “directly conflicts” with a management proposal.  Due to questions that have arisen about the proper scope and application of Rule 14a-8(i)(9), I have directed the staff to review the rule and report to the Commission on its review.

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SEC Creates Turmoil with Whole Foods No Action on Proxy Access

Proxy Access (P&I)

Pensions & Investments

Apologies to those tired of reading about the issue of proxy access at Whole Foods. However, the SEC’s no action letter is a real watershed moment in the long struggle for proxy access, which began in earnest for me with a rulemaking petition in August 2002 but which others have been puruing for decades. Last Friday I received a letters from the Council of Institutional Investors (CII) and the Marco Consulting Group Trust in support of my December 23, 2014 appeal. (See below or CII site.

I am delighted to see the growing concern and support from investors for my appeal. As has been pointed out in the press, we are now witnessing the beginning of an avalanche of copycat filings. See Continue Reading →

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Road to Proxy Access Altered Again

Road to Proxy Access (Photo by Erik Johansson)

Road to Proxy Access (Photo by Erik Johansson)

… If the stockholder is to regard himself as a continuing part-owner of the business in which he has placed his money, he must be ready at times to act like a true owner and to make the decisions associated with ownership. If he wants his interests fully protected he must be willing to do something of his own to protect them. This requires a moderate amount of initiative and judgment.  – Benjamin Graham and David Dodd, Securities Valuation, 1934

The most fundamental means for shareholders to act like true owners is to help decide who will represent their interests on the board of directors. It is not so much independent directors that shareowners want, but directors who are dependent on our vote – accountable to us, not to the corporate managers they oversee on our behalf.  Obtaining the right to proxy access has been a long and perilous road.

On December 1, 2014, SEC staff effectively cut the road, giving a free pass to every group of entrenched board members and managers that seeks to prevent proxy access and direct accountability to shareowners.  Continue Reading →

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Whole Foods Market’s Sham Proxy Access Proposal

Arron Bernstein

Arron Bernstein

The Global Proxy Watch (banner)following is a guest post from Aaron Bernstein. editor of Global Proxy Watch and a Senior Research Fellow at the Labor and Worklife Program at Harvard Law School.

This piece originally appeared in the November 7, 2014 edition of GPW. I reformatted, added the title, graphics and ads. Let’s hope the SEC recognizes Whole Foods Market’s (WFM) sham proxy access proposal for what it is and denies their no-action request. New York City Comptroller Scott M. Stringer and New York City’s pension funds have initiated a groundbreaking campaign to give shareowners the right of proxy access at 75 U.S. companies.  If the SEC grants WFM’s no action request, further progress on proxy access by New York and others could grind to a halt.

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Review: Carl Gershenson – Protecting Markets from Society

Carl Gershenson

Carl Gershenson

Carl Gershenson - “Protecting Markets from Society: Non-Pecuniary Claims in American Corporate Democracy” forthcoming in Politics & Society looks at the role of the state as ‘market protector.’ Protecting us from inside trading, pump and dump schemes, policing market players? Yes, that may be the primary duty of agencies such as the SEC. However, Gershenson turns our attention to a very important secondary duty – “protecting the market from disruptive challengers so that corporations may operate as if markets were autonomous.”

As we have seen in The Rise and Fall of Homo Economicus: The Myth of the Rational Human and the Chaotic Reality and the Economics of Good and Evil: The Quest for Economic Meaning from Gilgamesh to Wall Streetpeople are not rational robots. Continue Reading →

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Take Action: SEC-IAC Report on Impartiality Stops Short

Seal of SECThe Investor as Owner Subcommittee of the SEC’s Investor Advisory Committee (SEC-IAC) established pursuant to Section 911 of the Dodd-Frank Act issued a report on Impartiality in the Disclosure of Preliminary Voting Results. The recommendations will be discussed at a meeting on October 9, 2014.

When: Thursday, October 9, 10:00 am – 4:00 pm
Who: Investor Advisory Committee
What: Investor Advisory Committee Quarterly Meeting
Where: Multipurpose Room, SEC Headquarters, 100 F Street, NE, Washington, DC
Contact: Frankie White, Office of the Investor Advocate, (202) 551 – 4310

The members of the subcommittee are listed here. After I discuss the SEC-IAC’s two recommendations briefly below, which I support, I then urge readers to write to the SEC-IAC requesting they address additional issues of impartiality. Continue Reading →

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Tracey L. McNeil Named First SEC Ombudsman

The Securities and Exchange Commission (SEC) announced that Tracey L. McNeil has been selected as the first ombudsman for the agency. Seal of SEC Ms. McNeil will begin her new post on September 22.  She currently is a senior counsel in the SEC’s Office of Minority and Women Inclusion (OMWI), an office created by the 2010 Dodd-Frank Act.  In this position, she has advised the director of OMWI in establishing the office and has worked to ensure the fair inclusion and utilization of minorities, women, and minority-owned and women-owned businesses in all business and activities of the agency.   Continue Reading →

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