Corporate executives may soon hear a lot more from investors about climate change and social issues after the Securities and Exchange Commission, or SEC, took steps to make it easier for proposals on these topics to get a vote at annual shareholder meetings.
The SEC issued guidance Wednesday specifying public companies shouldn’t exclude shareholder plans from proxy ballots just because the ideas aren’t related to a firm’s business. The agency also said it plans to be more skeptical when companies ask for permission to withhold certain proposals on the grounds that top managers consider them to be inappropriately intrusive.
The change — which was not subject to a vote by the regulator’s commissioners — is the latest attempt by the agency to make it easier for shareholders to take action on hot-button issues like race and climate change since Chair Gary Gensler took the helm. The Biden administration has made environmental, social and governance matters a priority and Gensler has repeatedly clashed with Republicans over the SEC’s plans to write rules related to climate change and efforts to improve diversity of public companies.
“In recent years, hundreds of companies have come to the staff seeking no-action letters with respect to shareholder proposals,” Gensler said in a statement. The new guidance “will provide greater clarity to companies and shareholders.”
Earlier this year, the SEC refused to allow Citigroup Inc. to exclude a proposal from getting a vote that called for the bank to perform an audit on racial equity. Exxon Mobil Corp. was also denied when it sought an exemption for a proposal related to its efforts to deal with global warming.
A last-minute court filing ends a case against the federal tax-collecting agency that had drawn unprecedented conflict-of-interest questions from Democratic critics.
Advisors discuss their use of AI now and how it will change going forward
Medicare scam, pandemic benefit theft, offshore tax evasion — federal prosecutors are casting a wide net.
Report finds that pension income acts as a financial lifeline for retirees facing late-life shocks and raises urgent questions about the DC-only future.
Nine-month electronic trading freeze and share lending program at the center of dismissed claim.
As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management
Growth may get the headlines, but in my experience, longevity is earned through structure, culture, and discipline
