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‘Fix-It’ Proxy Access Proposals Hit Companies

November 7, 2016, Agenda Week

Keir Gumbs is quoted in an Agenda Week article regarding the new wave of shareholder proposals on proxy access. According to Gumbs, “the million-dollar question right now” is whether companies can omit shareholder proposals if they have implemented some of the provisions proponents have asked for, but not all of them.

Historically, the SEC has assessed substantial implementation arguments by reviewing the key features of the shareholder proposal and comparing them to the companies’ existing policies, procedures or practices, he says. If a proposal has six items and the company has already implemented half of them, that may be enough to secure no-action relief. So far however, SEC staff has denied no-action relief for fix-it proposals on the basis that they’ve already been substantially implemented. The companies can’t demonstrate that they’ve adopted the lion’s share of the practices requested in the shareholder proposals, Gumbs points out.


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