Below are the “Key Takeaways” from this excellent Cooley Alert penned by Brad Goldberg, Beth Sasfai, Michael Mencher, Liz Dunshee, Vince Flynn, Amanda Weiss and Justin Kisner: “1. Rescission of Rule 14a-8 would redirect activism, not eliminate it. Activism efforts are likely to shift toward other strategies, including director “vote no” campaigns, proxy contests, litigation, direct engagement and targeted publicity campaigns. If adopted, the proposed …
It’s Another Biggie! SEC Proposes to Rescind the Shareholder Proposal Rule
Yesterday, as noted in this press release, the SEC proposed to rescind Rule 14a-8 (at the same time as proposing to modernize the proxy solicitation process). Wow. Here’s the 228-page proposing release – and here’s the fact sheet. In that proposal, the SEC also proposed to amend Rule 14a-4(c) to provide companies with greater flexibility – and shareholders with greater control – regarding proposals for …
It’s a Biggie! The SEC Proposes to Streamline the Proxy Solicitation Process
Earlier today, as noted in this press release, the SEC proposed to modernize the proxy solicitation process (at the same time, it proposed to rescind Rule 14a-8 – which I’ll blog about tomorrow). Wow. Here’s the 152-page proposing release – and here’s the fact sheet. In the proposal, the SEC offers a number of elements of a proxy-plumbing modernization package: eliminate annual report delivery burdens, …
Glass Lewis Outlines Coming “Multi-Perspective Research” Framework
In a note to clients recently, Glass Lewis provided more detail about its shift to a multi-perspective model that it announced about a year ago. Last year, Glass Lewis announced that rather than relying principally on a single set of global voting policies, it intended to develop an approach offering clients multiple analytical perspectives reflecting different investment and governance philosophies. At the time, however, Glass …
Corp Fin Issues Three “Section 13G” CFIs Further Clarifying Shareholder Engagement Processes
Last week, Corp Fin issued three new CFIs relating to shareholder engagement and Schedule 13G eligibility as the Staff has continued to receive questions in the wake of the two CDIs issued about 18 months ago that caused some of the larger institutional investors to temporarily pause their engagement efforts and rethink their approach to engagement. These new CFIs further clarify that routine engagement …
SEC Proposes (Long Overdue) Transfer Agent Reform
Talk about overdue. The rules governing transfer agents hasn’t been substantively updated since the early ‘80s. That’s over forty years. Given that one of the larger transfer agents in the US demonstrated that its internal control environment was shaky a few years back – and that some of the newer entrants into the field aren’t that experienced – reform in this area is sorely needed. …
Delaware Chancery Reaffirms Challenges In Pleading a Caremark Case
A few weeks ago, the Delaware Chancery Court dismissed a lawsuit against a company’s directors and officers – alleging oversight claims premised on Caremark – after that company entered into a $237 million derivative settlement a few years ago. That settlement was the largest derivative ever in Delaware of a Caremark duty of oversight case. This dismissal highlights that a board that makes a good-faith …
Coming Soon! SEC to Propose Rescinding Rule 14a-8
I blogged on Friday that OIRA is reviewing the SEC’s proposed executive compensation disclosure reform – and now OIRA has listed two other big SEC proposals under review: As we’ve noted, OIRA has 90 days to complete its review but it often moves faster. Meaning the SEC will likely be proposing these rulemakings relatively soon. Hang onto your hats. It’s going to be a wild …
“Executive Compensation Disclosure Reform” Proposal Coming Soon!
Just in time to make your Labor Day more interesting? OIRA has listed the SEC’s proposal to reform executive compensation disclosures – meaning that agency is reviewing that rule proposal. And as we noted in this blog, even though OIRA has 90 days to complete a review, it often takes a fraction of that time. So we may well see the SEC’s proposal by next …
NYSE Proposes Extending Internal Audit Transition Period
A few weeks ago, the SEC published this notice for public comment over this NYSE proposal extending the transition period for newly listed companies to establish an internal audit department from one year to five years. Five years would give newly public companies more time to develop a meaningful program at a time when they are upgrading accounting systems and internal controls, adding personnel, and …