“Apple’s decision to give long-term shareholders a greater say in boardroom appointments is the most significant victory in an almost decade-long push to improve corporate accountability in the US, campaigners have said,” Stephen Foley reports for The Financial Times. “On Tuesday, the country’s largest company amended its bylaws to allow its investors to nominate directors, and shareholder rights groups claimed the move would make it harder for other companies to resist pressure to follow suit. Apple’s decision in favour of so-called proxy access — named after the ballot paper, or proxy, that is sent to shareholders ahead of annual meetings — takes to 129 the number of US companies to have adopted the practice.”
“While many hailed the move, opponents warned that proxy access could be used by special interest groups to push political, social or environmental agendas unsupported by a majority of shareholders,” Foley reports. “Steve Balet of FTI Consulting, which defends companies against activists, said the powers could be hijacked by shareholder groups. ‘There is already a way for shareholders to nominate directors, but it does require them to spend money, which in turn requires them to believe that they will add value by doing so,’ he said. ‘Proxy access is a free pass for activism by special interest groups.'”
Foley reports, “The Securities and Exchange Commission repeatedly debated making proxy access compulsory a decade ago, but the rule it eventually proposed in 2009 was struck down two years later after a legal challenge by the US Chamber of Commerce.”
Read more in the full article here.
MacDailyNews Take: Even if the process is hijacked someday, as we wrote yesterday, “It’s pretty easy for seven to ignore one.”
Apple offers proxy access, making shareholder nominations to the board easier – December 23, 2015