Opinion ID: 2814625
Heading Depth: 2
Heading Rank: 3

Heading: Shareholder Proposals

Text: A primary means to urge corporate reform is the shareholder proposal, which “communicate[s] not only [shareholders’] interest[] in a company’s financial performance, but also their interests and preferences concerning a wide range of issues, such as the board’s structure and oversight of important policies, sustainability, and ethical performance.” Brief of amici curiae Corporate and Securities Law Professors 2. The hard part, however, is soliciting votes to pass a proposal—especially where the motivation is to raise awareness of a policy issue. See James R. Copeland, Getting the Politics Out of Proxy Season, Wall St. J., A11 (Apr. 23, 2015) (“Not one of the 1,150 shareholder proposals concerning social or policy issues since 2006 got 27 the support of a majority of voting shareholders over board opposition.”). A shareholder can garner support in one of two ways. It can “pay to issue a separate proxy statement, which must satisfy all the disclosure requirements applicable to management’s proxy statement.” Apache Corp., 696 F. Supp. 2d at 727 (citation omitted). Or the shareholder can go the Rule 14a-8 route and have the company include its proposal (and a supporting statement) in the proxy materials at the company’s expense. See id. at 728.