2015 Proxy Season to Feature Shareholder Proposals, Thanks to S.E.C. Ruling

Investors are looking forward to a lively 2015 proxy season after a S.E.C. ruling that allows questions about corporate governance to be aired at shareholder meetings, according to a report in the New York Times. The ruling reversed an earlier S.E.C. decision that permitted Whole Foods to exclude a shareholder proposal for large investors to nominate directors at the company’s annual meeting. The issue has long been a source of friction between shareholders and companies, who traditionally have asked for “no action letters” from the S.E.C. that permitted them to keep such proposals off their proxy statements. Investors argued that barring investors from nominating corporate directors has kept boards insular and pro-management, and resulted in a lack of accountability. The S.E.C. seems to be voting in favor of more access for shareholders. We think that’s “business, better” in action.

John Howell, Editorial Director