Recently, the staff of the U.S. Securities and Exchange Commission has issued a number of no-action letters responding to company requests to exclude shareholder proxy access proposals from the proxy statement for the company’s 2012 annual meeting. The SEC staff permitted the exclusion of the most common form, a precatory 1% or 100-holder proposal based on a model issued by the United States Proxy Exchange, but did not allow exclusion of others, including the Norges Bank binding 1% proposal. These no-action letters serve as a reminder that, although changes to SEC Rule 14a-8 that took effect last year permit shareholders to propose the adoption of proxy access provisions, these proxy access proposals will not be afforded special treatment under the SEC rules and will continue to be subject to exclusion under the traditional bases set forth in Rule 14a-8.

As a result of the SEC staff’s concurrence as to the excludability of the most common form of proposal, there will be a more limited number of proxy access proposals coming to a vote in the 2012 proxy season. The terms of proxy access proposals in future years are likely to depend, to a large extent, on the level of shareholder support received by this limited group.

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