Thomas W. Christopher and Tony Richmond are partners at Latham & Watkins LLP. This post is based on a Latham publication by Mr. Christopher, Mr. Richmond, Brian Miller, Tiffany Fobes Campion, Jessica Lennon, and Danit Tal.
Many public companies have received shareholder proxy access proposals in connection with their upcoming 2017 annual meetings and additional companies are likely to receive proposals in the coming months. Proxy access is a mechanism that gives shareholders the right to nominate directors for inclusion in the company’s annual meeting proxy statement. Proxy access gained significant momentum in 2015 and 2016, with more than 200 proposals submitted to shareholders and approximately 58% of those proposals receiving shareholder approval. [1]
Accordingly, public companies may wish to consider proxy access and develop a plan for responding to a shareholder proxy access proposal. Based on lessons learned in recent years, this post summarizes:
- Actions a public company can take to prepare for receiving a proxy access proposal
- Whether a company should wait and react to a specific shareholder proxy access proposal or preemptively adopt its own proxy access regime
- Alternatives available to a company following receipt of a proxy access proposal