Proxy Rules

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On May 2, 2014, the Delaware Chancery Court denied a motion to preliminarily enjoin Sotheby’s annual stockholder meeting based on allegations by an activist stockholder, Third Point LLC, that the Sotheby’s board of directors violated its fiduciary duties by adopting a rights plan (or “poison pill”) and refusing to provide a waiver from its terms in order to obtain an advantage in an ongoing proxy contest. 
Continue Reading Rights Plans and Proxy Contests: Chancery Court Denies Activist’s Motion to Enjoin Sotheby’s Shareholder Meeting

On March 11, 2014, the Conference Board released results of its year-long multifaceted study of corporate/investor engagement.  The topic encompasses practical and systemic issues of critical importance to public companies and investors, which in the long term will impact U.S. macro-economic performance.
Continue Reading The Conference Board Governance Center Task Force on Corporate/Investor Engagement

Over the past year, boards of directors continued to face increasing scrutiny from shareholders and regulators, and the consequences of failures became more serious in terms of regulatory enforcement, shareholder litigation and market reaction. We expect these trends to continue in 2014, and proactive board oversight and involvement will remain crucial in this challenging environment.
Continue Reading Selected Issues for Boards of Directors in 2014

On October 16, 2012, proxy advisory firm Institutional Shareholder Services (ISS) issued for comment proposed changes to its U.S. voting policies for 2013.  ISS’s proposed changes focus primarily on compensation-related matters.  Of particular note in that regard is a modest revision to ISS’s approach to peer group selection for purposes of its pay for performance analysis.  ISS also proposed a change that highlights its concern with companies’ responsiveness to majority-supported shareholder proposals.
Continue Reading ISS Focuses on Pay and Majority-Supported Shareholder Proposals in Proposed Changes to U.S. Voting Policies for 2013

Following the SEC’s decision not to seek a rehearing of the decision by the U.S. Court of Appeals for the District of Columbia Circuit vacating its “proxy access” rule (Rule 14a-11 under the Securities Exchange Act of 1934), the stay on the companion “private ordering” amendments to Rule 14a-8 was lifted and those amendments are now in effect. Companies can no longer exclude otherwise-qualifying shareholder proposals seeking to establish a procedure in a company’s governing documents to permit shareholder nominees to be included in the company’s future proxy statements. As with other shareholder proposals, in order to make an access proposal a shareholder need only own $2,000 of company stock and have held it continuously for one year.
Continue Reading Preparing for “Proxy Access” Shareholder Proposals