The 2012 proxy season evidences the fact that many retail and institutional shareholders continue to be actively involved in looking out for what they perceive to be the best interests of companies in which they have invested their capital. In particular, shareholders continue to show an interest in being able to have a say in who serves as a director, whether that be by means of a proxy contest (or threatened proxy contest), submitting a nominee for consideration as a director or submitting a shareholder proposal to amend the company’s charter documents to allow qualified shareholders to place a director nominee on the company’s annual proxy statement (so-called “proxy access” proposals).
With regard to proxy access proposals, it seems likely the pace of such proposals will increase over the next few years. Indeed, two such proposals recently won shareholder approval, and this will likely encourage other shareholders to push for proxy access, particularly at small and mid-size companies where shareholders believe they can have an immediate impact. While the pace of such proposals will likely increase, it is also probable that companies will continue to resist such proposals and will not file their own proxy access proposals or agree to accept and enact proxy access proposals instead of having the proposals go to a shareholder vote.