2025 REVIEW FROM MIKE LEVIN:
Big proxy contests: PHX-Elliott
Significant situations: PEP-Elliott
TSLA AGM
SEC rules on shareholder proposals
Proxy advisor pressure
Delaware under scrutiny
US stakes in INTL, others
XOM retail voting program
2026 PREDICTIONS:
DIRECTORS
Will a director be voted out in an uncontested election this year for a reason OUTSIDE of attendance (re: Netflix’s Jay Hoag’s 78% NO vote) at a big US company?
The average percentage of directors getting less than 50% of the vote is 0.2% - generally it happens due to activism OR attendance. Will it happen for some other reason?
Canary in a coal mine: what will Hoag’s FOR votes be in 2026?
The average percentage of women on boards will be?
Most recent data shows a 22% drop in new diverse candidates on boards, and Damion pulled a stunning number of “Down to 2” as a common refrain for boards looking to diversify away from women. The current average number of women on large cap US boards is 30% - how far does the average move after 2025-6?
SHAREHOLDER PROPOSALS
Which company will allow the most shareholder proposals?
In 2025, Alphabet clocked in with the highest number of shareholder proposals at 13, followed by Meta at 9, Amazon at 8, and Walmart and Berkshire tied at 7.
Which one of these shareholder proponents will see the highest number of exclusions in 2026:
Activists: (23% supports in 2025)
Anti woke: (2%)
AOs / Pensions: (12%)
Woke: (10%)
Governance: (29%)
Religious: (10%)
Number of shareholder proposals that will WIN in 2026 (approx 50 in 2025)?
E vs S vs G (45 vs 5 vs 0)
Palo Alto Networks on Tuesday: 93% YES on a James McRitchie bid to eliminate its classified board, despite the company being AGAINST.
PAY
How many companies will fail Say on Pay in 2026 (27, About 1.2% of Russell 3000 companies, failed Say on Pay in 2025)?
Palo Alto failed Tuesday: 54% NO
How many post-Musk billion dollar+ CEO pay packages will we see in 2026?
Which is more likely:
Which is the SEC more likely to have to redefine to address the December 11, 2025 executive whining titled “PROTECTING AMERICAN INVESTORS FROM FOREIGN-OWNED AND POLITICALLY-MOTIVATED PROXY ADVISORS”, which asks the SEC to “consider” rescinding rule 14-8a, investigating if proxy advisors committed securities fraud (and should be registered), consider forcing methodology disclosure, “investigate” collusion with asset managers, and calling proxy advisors “fiduciaries” if they charge a fee to pension funds:
Anti-fraud laws - currently the laws deal with the “purchase or sale” of a security, not saying “this non binding shareholder proposal about donut hole size is a vote YES based on the criteria you provided”... they would have to redefine scienter to include advice for sale, not securities? Or they would have to decide that they had a coordinated scheme to defraud THE ENTIRE MARKET?
Investment advice fiduciaries - ERISA sets duty of loyalty, care, and prudence, and it applies to anyone exercising discretion over a pension for a fee - they would have to consider the purchase of ANY data, rating, opinion, or even made-to-order service (like back end data dashboards) a form of advice, and thus make them all fiduciaries. Unless they just change the rule and say “proxy advisors are fiduciaries” because kabuki theater?
ESG - they’ve included in here considering rescission of rules that “advance” ESG policies - but there’s a G in ESG. That would include literally the act of voting, the election of directors, special meetings, bylaws amendments - EVERYTHING that happens. In which case, do they need to redefine ESG to just mean “woke stuff we don’t like” (which could, in fact, mean G also)? And is every activist investor then woke?
The SEC No-Action gaslight - where they no longer will oppose shareholder proposal exclusions - is more likely to:
Result in more votes against directors - between the 13g vs. 13d guidance and the “we’re just too busy to read shareholder proposals for an entire year” guidance, and ISS [i think it’s actually glass lewis that’s moving away from recommendations entirely] suggesting they won’t actually provide a recommendation anymore, there’s not much else for investors to do, right?
Fuel a rise in shareholder proposals - and disclosure from proponents about exclusions to “name and shame” companies who are using the feckless SEC as cloud cover to avoid governance or shareholder demands.
Fuel a rise in activism - in the absence of being able to ask a company to make an amendment to a bylaw or declassify a board on the proxy, doesn’t it just make activism more hostile? If a company is underperforming, investors don’t have the SEC behind them as much any more? Coupled with Texas rules that make it harder to file proposals at all, and the move toward mandatory arbitration vs. regulatory/legal oversight, it’s all activism now, right?
Push more companies to Texas - the SEC is basically Texas-ifying guidance, but Delaware isn’t biting yet. Inevitably, do more companies move to Texas to take advantage of having fewer shareholder rights?
Musk’s mega pay package is more likely to:
Open the floodgates to mini-Musk packages - instead of 10 years and 12 tranches, expect pay committees to start putting forward 4 years and 6 tranche billion dollar packages for companies that make hydraulic presses and deli meat.
Push investors to vote against pay EVERYWHERE, since they already feel bad giving Musk so much (like after you eat too much chocolate, you just never want it again)
End say on pay - what’s the point really? Some fringe investors vote against pay, and it’s non binding? If you are excluding shareholder proposals anyway, why not end say on pay and force investors to just vote against pay committee members?
DO NOTHING. No one actually cares how much an executive gets paid, all the CEO pay ratio data and disclosures are kabuki theater anyway.
DExit winner is most likely:
Nevada
Texas
Delaware
No one
All content for PROXY COUNTDOWN is the property of Free Float Media, Inc. and is served directly from their servers
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2025 REVIEW FROM MIKE LEVIN:
Big proxy contests: PHX-Elliott
Significant situations: PEP-Elliott
TSLA AGM
SEC rules on shareholder proposals
Proxy advisor pressure
Delaware under scrutiny
US stakes in INTL, others
XOM retail voting program
2026 PREDICTIONS:
DIRECTORS
Will a director be voted out in an uncontested election this year for a reason OUTSIDE of attendance (re: Netflix’s Jay Hoag’s 78% NO vote) at a big US company?
The average percentage of directors getting less than 50% of the vote is 0.2% - generally it happens due to activism OR attendance. Will it happen for some other reason?
Canary in a coal mine: what will Hoag’s FOR votes be in 2026?
The average percentage of women on boards will be?
Most recent data shows a 22% drop in new diverse candidates on boards, and Damion pulled a stunning number of “Down to 2” as a common refrain for boards looking to diversify away from women. The current average number of women on large cap US boards is 30% - how far does the average move after 2025-6?
SHAREHOLDER PROPOSALS
Which company will allow the most shareholder proposals?
In 2025, Alphabet clocked in with the highest number of shareholder proposals at 13, followed by Meta at 9, Amazon at 8, and Walmart and Berkshire tied at 7.
Which one of these shareholder proponents will see the highest number of exclusions in 2026:
Activists: (23% supports in 2025)
Anti woke: (2%)
AOs / Pensions: (12%)
Woke: (10%)
Governance: (29%)
Religious: (10%)
Number of shareholder proposals that will WIN in 2026 (approx 50 in 2025)?
E vs S vs G (45 vs 5 vs 0)
Palo Alto Networks on Tuesday: 93% YES on a James McRitchie bid to eliminate its classified board, despite the company being AGAINST.
PAY
How many companies will fail Say on Pay in 2026 (27, About 1.2% of Russell 3000 companies, failed Say on Pay in 2025)?
Palo Alto failed Tuesday: 54% NO
How many post-Musk billion dollar+ CEO pay packages will we see in 2026?
Which is more likely:
Which is the SEC more likely to have to redefine to address the December 11, 2025 executive whining titled “PROTECTING AMERICAN INVESTORS FROM FOREIGN-OWNED AND POLITICALLY-MOTIVATED PROXY ADVISORS”, which asks the SEC to “consider” rescinding rule 14-8a, investigating if proxy advisors committed securities fraud (and should be registered), consider forcing methodology disclosure, “investigate” collusion with asset managers, and calling proxy advisors “fiduciaries” if they charge a fee to pension funds:
Anti-fraud laws - currently the laws deal with the “purchase or sale” of a security, not saying “this non binding shareholder proposal about donut hole size is a vote YES based on the criteria you provided”... they would have to redefine scienter to include advice for sale, not securities? Or they would have to decide that they had a coordinated scheme to defraud THE ENTIRE MARKET?
Investment advice fiduciaries - ERISA sets duty of loyalty, care, and prudence, and it applies to anyone exercising discretion over a pension for a fee - they would have to consider the purchase of ANY data, rating, opinion, or even made-to-order service (like back end data dashboards) a form of advice, and thus make them all fiduciaries. Unless they just change the rule and say “proxy advisors are fiduciaries” because kabuki theater?
ESG - they’ve included in here considering rescission of rules that “advance” ESG policies - but there’s a G in ESG. That would include literally the act of voting, the election of directors, special meetings, bylaws amendments - EVERYTHING that happens. In which case, do they need to redefine ESG to just mean “woke stuff we don’t like” (which could, in fact, mean G also)? And is every activist investor then woke?
The SEC No-Action gaslight - where they no longer will oppose shareholder proposal exclusions - is more likely to:
Result in more votes against directors - between the 13g vs. 13d guidance and the “we’re just too busy to read shareholder proposals for an entire year” guidance, and ISS [i think it’s actually glass lewis that’s moving away from recommendations entirely] suggesting they won’t actually provide a recommendation anymore, there’s not much else for investors to do, right?
Fuel a rise in shareholder proposals - and disclosure from proponents about exclusions to “name and shame” companies who are using the feckless SEC as cloud cover to avoid governance or shareholder demands.
Fuel a rise in activism - in the absence of being able to ask a company to make an amendment to a bylaw or declassify a board on the proxy, doesn’t it just make activism more hostile? If a company is underperforming, investors don’t have the SEC behind them as much any more? Coupled with Texas rules that make it harder to file proposals at all, and the move toward mandatory arbitration vs. regulatory/legal oversight, it’s all activism now, right?
Push more companies to Texas - the SEC is basically Texas-ifying guidance, but Delaware isn’t biting yet. Inevitably, do more companies move to Texas to take advantage of having fewer shareholder rights?
Musk’s mega pay package is more likely to:
Open the floodgates to mini-Musk packages - instead of 10 years and 12 tranches, expect pay committees to start putting forward 4 years and 6 tranche billion dollar packages for companies that make hydraulic presses and deli meat.
Push investors to vote against pay EVERYWHERE, since they already feel bad giving Musk so much (like after you eat too much chocolate, you just never want it again)
End say on pay - what’s the point really? Some fringe investors vote against pay, and it’s non binding? If you are excluding shareholder proposals anyway, why not end say on pay and force investors to just vote against pay committee members?
DO NOTHING. No one actually cares how much an executive gets paid, all the CEO pay ratio data and disclosures are kabuki theater anyway.
DExit winner is most likely:
Nevada
Texas
Delaware
No one
Surveys: directors want you to vote them out, plus a vote out at John Wiley and female replacement theory
PROXY COUNTDOWN
53 minutes 42 seconds
3 months ago
Surveys: directors want you to vote them out, plus a vote out at John Wiley and female replacement theory
The silent female retreat
The not-so-secret power of the lead independent director
An aggressive activist atmosphere is heating up
A college professor in a bow tie gets voted out
And on the Big Vote, Matt talks Surveys
Trade Wire - BUY/SELL
Top Stories:
proxy countdown_trade wire_2025 - Google Sheets
Tracking Noteworthy 8-Ks since September 24th:
DIrector comings and goings:
Men added: 22
Men subtracted: 7
Women added: 6
Women subtracted: 5
Down to 2F:
Fannie Mae: Karin Kimbrough resigned
Down to 1F:
F&M BANK: Daphyne S. Thomas retired
Rocket Companies, Inc. (RKT): Jennifer Gilbert resigned; appointing Mr. Jay Bray to serve as a Class II director and Mr. Tagar Olson to serve as a Class I director
Pitney Bowes: Milena Alberti-Perez resigned (Julie Schoenfeld resigned in July)
Stupidities/Oddities:
IDEXX LABORATORIES INC /DE (IDXX)
elected Karen Peacock
Ms. Peacock will stand for election by stockholders as a Class I Director at the Company’s 2027
IonQ, Inc. (IONQ, IONQ-WT)
appointed John W. Raymond
General Raymond was appointed as a Class I director whose term will expire at the Company’s 2028 Annual Meeting of Stockholders
Rocket Companies, Inc. (RKT)
appointing Mr. Jay Bray to serve as a Class II director until 2028
Mr. Tagar Olson to serve as a Class I director until 2027
F&M BANK CORP: Daphyne S. Thomas: Upon reaching the mandatory retirement age, Ms. Thomas became an honorary director and will continue to function as such until she tenders her resignation to the board or until the board requests that she tender her resignation. Under Section 2.11 of the Bylaws, an honorary director may attend board meetings but is not entitled to vote.
NEOs
Disney: Sonia L. Coleman, the Company’s Senior Executive Vice President and Chief Human Resources Officer, changed title was to Senior Executive Vice President and Chief People Officer
increased Ms. Coleman’s annual base salary to $1,000,000; increased her target annual bonus opportunity to 175% of her base salary; and increased her target long-term equity incentive annual award value to 375% of her base salary
CEOs
COMCAST CORP: Michael J. Cavanagh will be appointed Co-CEO along with current CEO and Chair Brian Roberts, the son of Comcast founder Ralph Roberts
VERIZON COMMUNICATIONS: lead director Daniel H. Schulman succeeding Hans E. Vestberg
Money
Norfolk Southern: One-time cash retention to all NEOs
Mark R. George—$4,000,000; Jason A. Zampi—$2,250,000; John F. Orr—$3,000,000; Claude E. Elkins—$2,000,000; and Anil Bhatt—$2,000,000
Pepsi CFO Golden Hello: $9M
Strategy Inc: increase to the annual cap for the security program maintained for Michael J. Saylor, Executive Chairman/former CEO/co-founder, under which the Company covers certain security-related costs. Previously, the annual cap for this program was $1,400,000; effective in calendar year 2025, the cap will be increased to $2,000,000
Dell Technologies: one-time performance-based stock option award to COO Jeffrey Clarke valued at $132.4M
CSX CORP: appointed Stephen Angel as CEO; $10.1M golden hello
PROXY CAGE MATCH
Activist investors launched a record number of new campaigns in Q3, with 61 new campaigns, up sharply from 36 a year earlier.
Barclays’ new data show that activism is accelerating globally, with a 90% quarter-on-quarter increase in the U.S.
Year-to-date figures indicate nearly 191 campaigns targeting 178 companies, with activists securing 98 board seats and driving approximately 25 CEO departures thus far
Japanese game company GungHo Online Entertainment, has rejected a proposal from activist investors to dismiss its longtime CEO Kazuki Morishita
The proposal was put forward by Strategic Capital, a Tokyo-based investment fund which controls over 11% of GungHo’s voting rights.
During an extraordinary shareholders’ meeting held at its request on September 24, the activist pushed for: 1) the requirements for ousting an executive to be relaxed 2) for Morishita to be fired from his position as CEO.
While the first proposal was accepted, the attempt to remove Morishita failed, not gaining enough votes from majority shareholders.
Irenic Capital Management, which owns about 2% of Workiva, wants board and governance changes:
Specifically, the hedge fund is urging the company to collapse its dual-class share structure, make all board members stand for election every year and add two newcomers, including Irenic executive Krishna Korupolu, to the board.
The hedge fund also expressed considerable concern about the company's governance, noting that five of its seven directors have served on the board since 2014.
Acadia Healthcare has appointed Todd Young as CFO, amid growing pressure from activist investors Khrom Capital and Engine Capital — which together own more than 8% of the company
VOTE RESULTS TABLE
Freedom Holding Corp. (FRHC)
0 SHP
classified; Philippe Vogeleer 99.2%
FEDEX CORP (FDX)
1 SHP: independent board chairman 43% yes
97% yes; Smith 10% NO
37% NO pay
PAUL S. WALSH (CHAIR) 94%
Silvia Davila 97%
Susan Patricia Griffith 98%
Amy B. Lane 99.5%
Susan C. Schwab 96%
GENERAL MILLS INC (GIS)
2 SHP
Regenerative Agriculture Practices Within Supply Chain 27% YES
Separate the Board Chair and CEO Roles 36% YES
avg 97% YES
RPM INTERNATIONAL (RPM)
0 SHP
99.7% YES Craig Morford; 9/12 up for election as company in process of declassification
CARPENTER TECHNOLOGY CORP (CRS)
0 SHP
Classified
at John Wiley & Sons:
54% said NO to Governance Committee Chair Brian Hemphill
The Board, upon recommendation of the Governance Committee, determined not to accept Mr. Hemphill’s resignation: “The Board concluded that the voting outcome reflected proxy advisory firm recommendations unrelated to Mr. Hemphill's individual performance or contributions. The Board determined that Mr. Hemphill's continued service is in the best interests of the Company and its shareholders”
THE BIG VOTE PICKS
DAMION
Upcoming Meetings September 29-
AGM Date
Company
SHPs #
Notes
10/13
MillerKnoll Inc
0
Classified: 3 dirs
10/14
Procter & Gamble
1
As You Sow: Plastic Packaging 23%
10/16
Medtronic
0
Irish
10/16
CACI International
0
no Say on Pay; 3 directors
Matt
SURVEY SEASON
Executives
PwC Board Effectiveness Survey - August 2025
All NEOs, ~500 of them
Biggest representation in tech/media (23%)
Mostly mid (35%) and large (26%) companies
Directors
PwC Annual Corporate Directors Survey - October 2025
More than 600 directors surveyed
Mostly mid cap (33%) and large cap (37%)
Mostly men (65%) - and no question about race/ethnicity
Mostly longer tenured (6+ years, 56%)
Asset Owners
Morningstar’s Voice of the Asset Owner Survey 2025 - October 2025
500 asset owners, 19tn in assets
Mostly EU and APAC, 20% US
Mostly 1-100bn in assets
SURVEYS SAY…
How important is voting out a director?
Executives: 93% of executives say at least one director should be replaced, 78% say 2 or more
Directors: 55% think AT LEAST ONE should be replaced, and 7% of directors - nearly 1 in 10 - think MORE THAN TWO directors
Investors: 35% said they voted - IN EITHER DIRECTION - at all
To put that in perspective, investor voter turnout is roughly equivalent to voter turnout in Syria (37%)
Are boards any good?
Executives: 35% of executives rate their boards as “excellent” or “good”
IT executives think their boards are the WORST - only 21% think they’re effective at all, and 40% think they’re straight up “Poor”
Directors: 68% of board Boards think they have an effective assessment process
Investors: only 35% of investors said board composition was material AT ALL, much less worrying about how effective those boards were
Are we culling directors that suck?
Executives: 50% of executives feel confident a board will remove an underperformer
Directors: 34% of directors think the chair/lead director is “very effective” in dealing with underperforming directors - the lowest of the options
Investors: Only 35% even VOTE, and the average vote for a director is 96% in favor - 0.2% of directors annually are voted out
Why aren’t we cutting directors exactly??
Executives: 57% said “Board leadership is unwilling to have difficult conversations with underperforming directors”, while 48% say “Individual director assessments are not performed”
This checks out - only 27% of directors said as part of the assessment process, they did individual assessments
ACTION ITEM: USE DATA TO DO INDIVIDUAL ASSESSMENTS
Directors: The main reason why they haven’t been replaced is “personal relationships with board members”
Investors: Only 35% even VOTE, but 52% do vote on shareholder resolutions - maybe if there was a shareholder resolution that said “do a report on individual director assessments, focusing on old, long tenured, underperforming directors”, they might actually approve a report on it since they won’t vote against a human?
What makes a sucky director?
Executives: advanced age, overboarding, long tenure, and unprepared for meetings
When asked what a coaching a board chair should give underperforming directors: 36% say “not actively participating in discussions”, and 33% say dominating discussions
Directors: “does not meaningfully contribute to discussions” and “long tenure”
Investors: only 14% of asset owners find it “very useful” to do stewardship, which includes voting proxies, and 16% said they “don’t know” if it’s useful - the only time we see votes against consistently is for attendance and overboarding (like SUPER overboarding)
What’s the most important issue?
Executives: Executives are asking boards to spend more time… on ESG? 50%, the highest overall ask. What keeps them up at night is talent management (18%)
Directors: 34% said they plan on adding “industry expertise” - which suggests 1 in 3 boardrooms might have none?
Investors: Business ethics remains number 1, and is the TOP RANKED material issue of every issue they asked - 68% of asset owners agreed
What do boards need?
Executives: 37% said more education
Directors: 45% said more education
Investors: Not asked because they don’t care
Other fun survey tidbits…
Only 15% of executives think the board has sufficient gender/racial/ethnic diversity, while…
25% of directors thought they could improve the board by seeking “more diverse viewpoints”
Boards think - at a 94% plus rate - their interactions with management were very or somewhat effective, including “developing relationship with management outside of the boardroom”
So what do you do with this, investors?
Executives WANT YOU TO VOTE OUT DIRECTORS
Directors ALSO WANT YOU TO VOTE THEM OUT
ACTION: VOTE OUT DIRECTORS - find underperformers, long-tenured or over-aged directors and swap them - only directors care about “collegiality”, executives don’t care because they need diverse viewpoints
ACTION: Stop obsessing over shareholder proposals - they don’t matter nearly as much as you think they do investors
Directors themselves seem like they don’t have enough expertise on the industry where they’re a director, and investors are worried directors are in it for themselves (ethics) while executives need them to think about exogenous risk (ESG)
ACTION: It’s time to marry skills of directors to companies, looking for the exogenous long term risks facing an industry - use data to find them!
ACTION: Don’t ask about AI skills on the board, they have to manage ALL exogenous risks over the long term, AI among them - when you myopically focus on just one, you miss the next wave of risk
PROXY COUNTDOWN
2025 REVIEW FROM MIKE LEVIN:
Big proxy contests: PHX-Elliott
Significant situations: PEP-Elliott
TSLA AGM
SEC rules on shareholder proposals
Proxy advisor pressure
Delaware under scrutiny
US stakes in INTL, others
XOM retail voting program
2026 PREDICTIONS:
DIRECTORS
Will a director be voted out in an uncontested election this year for a reason OUTSIDE of attendance (re: Netflix’s Jay Hoag’s 78% NO vote) at a big US company?
The average percentage of directors getting less than 50% of the vote is 0.2% - generally it happens due to activism OR attendance. Will it happen for some other reason?
Canary in a coal mine: what will Hoag’s FOR votes be in 2026?
The average percentage of women on boards will be?
Most recent data shows a 22% drop in new diverse candidates on boards, and Damion pulled a stunning number of “Down to 2” as a common refrain for boards looking to diversify away from women. The current average number of women on large cap US boards is 30% - how far does the average move after 2025-6?
SHAREHOLDER PROPOSALS
Which company will allow the most shareholder proposals?
In 2025, Alphabet clocked in with the highest number of shareholder proposals at 13, followed by Meta at 9, Amazon at 8, and Walmart and Berkshire tied at 7.
Which one of these shareholder proponents will see the highest number of exclusions in 2026:
Activists: (23% supports in 2025)
Anti woke: (2%)
AOs / Pensions: (12%)
Woke: (10%)
Governance: (29%)
Religious: (10%)
Number of shareholder proposals that will WIN in 2026 (approx 50 in 2025)?
E vs S vs G (45 vs 5 vs 0)
Palo Alto Networks on Tuesday: 93% YES on a James McRitchie bid to eliminate its classified board, despite the company being AGAINST.
PAY
How many companies will fail Say on Pay in 2026 (27, About 1.2% of Russell 3000 companies, failed Say on Pay in 2025)?
Palo Alto failed Tuesday: 54% NO
How many post-Musk billion dollar+ CEO pay packages will we see in 2026?
Which is more likely:
Which is the SEC more likely to have to redefine to address the December 11, 2025 executive whining titled “PROTECTING AMERICAN INVESTORS FROM FOREIGN-OWNED AND POLITICALLY-MOTIVATED PROXY ADVISORS”, which asks the SEC to “consider” rescinding rule 14-8a, investigating if proxy advisors committed securities fraud (and should be registered), consider forcing methodology disclosure, “investigate” collusion with asset managers, and calling proxy advisors “fiduciaries” if they charge a fee to pension funds:
Anti-fraud laws - currently the laws deal with the “purchase or sale” of a security, not saying “this non binding shareholder proposal about donut hole size is a vote YES based on the criteria you provided”... they would have to redefine scienter to include advice for sale, not securities? Or they would have to decide that they had a coordinated scheme to defraud THE ENTIRE MARKET?
Investment advice fiduciaries - ERISA sets duty of loyalty, care, and prudence, and it applies to anyone exercising discretion over a pension for a fee - they would have to consider the purchase of ANY data, rating, opinion, or even made-to-order service (like back end data dashboards) a form of advice, and thus make them all fiduciaries. Unless they just change the rule and say “proxy advisors are fiduciaries” because kabuki theater?
ESG - they’ve included in here considering rescission of rules that “advance” ESG policies - but there’s a G in ESG. That would include literally the act of voting, the election of directors, special meetings, bylaws amendments - EVERYTHING that happens. In which case, do they need to redefine ESG to just mean “woke stuff we don’t like” (which could, in fact, mean G also)? And is every activist investor then woke?
The SEC No-Action gaslight - where they no longer will oppose shareholder proposal exclusions - is more likely to:
Result in more votes against directors - between the 13g vs. 13d guidance and the “we’re just too busy to read shareholder proposals for an entire year” guidance, and ISS [i think it’s actually glass lewis that’s moving away from recommendations entirely] suggesting they won’t actually provide a recommendation anymore, there’s not much else for investors to do, right?
Fuel a rise in shareholder proposals - and disclosure from proponents about exclusions to “name and shame” companies who are using the feckless SEC as cloud cover to avoid governance or shareholder demands.
Fuel a rise in activism - in the absence of being able to ask a company to make an amendment to a bylaw or declassify a board on the proxy, doesn’t it just make activism more hostile? If a company is underperforming, investors don’t have the SEC behind them as much any more? Coupled with Texas rules that make it harder to file proposals at all, and the move toward mandatory arbitration vs. regulatory/legal oversight, it’s all activism now, right?
Push more companies to Texas - the SEC is basically Texas-ifying guidance, but Delaware isn’t biting yet. Inevitably, do more companies move to Texas to take advantage of having fewer shareholder rights?
Musk’s mega pay package is more likely to:
Open the floodgates to mini-Musk packages - instead of 10 years and 12 tranches, expect pay committees to start putting forward 4 years and 6 tranche billion dollar packages for companies that make hydraulic presses and deli meat.
Push investors to vote against pay EVERYWHERE, since they already feel bad giving Musk so much (like after you eat too much chocolate, you just never want it again)
End say on pay - what’s the point really? Some fringe investors vote against pay, and it’s non binding? If you are excluding shareholder proposals anyway, why not end say on pay and force investors to just vote against pay committee members?
DO NOTHING. No one actually cares how much an executive gets paid, all the CEO pay ratio data and disclosures are kabuki theater anyway.
DExit winner is most likely:
Nevada
Texas
Delaware
No one
