Trillium Leads Social Investment Forum Effort to Support Proxy Access
Shareowners of corporate stock supposedly have their interests represented by elected board of directors. But we are not allowed to nominate directors to the ballot, unless we bear the costs of a “proxy fight,” expending hundreds of thousands of dollars to each shareholder ourselves. Therefore in practice, shareholders are represented by management’s handpicked nominees. While there are other barriers to meaningful corporate elections, the costs associated with an independent proxy solicitation is perhaps the most significant barrier. For the first time, however, the possibility of meaningful reform is real.
The Securities and Exchange Commission (SEC) is currently considering whether to allow shareholders to offer their own nominees to the board and, most importantly, have those nominees appear in the company proxy statement. If the proxy access proposed rule is adopted, corporate directors will be compelled to take shareholder concerns much more seriously or face real challenges to their monopoly on leadership.
In light of the past year’s events and the importance of this issue, Trillium took a leading role within the Social Investment Forum (SIF) to help develop the template letter for SIF members wishing to comment on the SEC proposed rule. Our comment letter can be found on the SEC website and here.