The SEC sure isn’t shying away from controversial topics this summer. Less than a month after adopting a somewhat watered-down version of its proposed proxy advisor regulations, the SEC has calendared an open meeting for next month to consider amendments to the shareholder proposal rules. Here’s an excerpt from the Sunshine Act Notice:
The Commission will consider whether to modernize and enhance the efficiency of the shareholder-proposal process for the benefit of all shareholders by adopting amendments to certain procedural requirements for the submission of shareholder proposals and the provision relating to resubmitted proposals under Rule 14a-8. The amendments being considered seek to modernize the system for the first time in over 35 years and reflect many years of engagement by Commission staff with investors, issuers and other market participants.
The SEC issued proposed rules last November that would increase the ownership thresholds for submission of proposals for inclusion in a company’s proxy statement and substantially raise the bar in terms of the favorable vote required to allow shareholders to resubmit proposals in subsequent years. Other proposed changes to Rule 14a-8(b) would subject shareholders using representatives to enhanced documentation requirements with respect to the authority of those agents, and require shareholder-proponents to express a willingness to meet with the company and provide contact and availability information.
The proposals have produced an avalanche of comments – both real and, apparently, of the “Astroturf” variety. For example, the proposal’s comments page discloses that the SEC received over 5,000 identical form comment letters opposing the proposal, but that it has also “received messages from certain of the email addresses that sent this comment letter indicating that the owner of the email address did not submit a comment letter.”
The meeting is scheduled for September 16th, which means that if rules are adopted, we’ll be all over them at our upcoming “Proxy Disclosure” & “Executive Pay” conferences — which will be held entirely virtually over three days — September 21-23. We’ve offered a live nationwide video webcast for our conferences for years — one of the only events to do so — and we’re excited to build on that platform and make your digital experience better than ever. Act now to get the best price.
-John Jenkins, TheCorporateCounsel.net August 17, 2020
