The Shareholder Rights Project (SRP) is a clinical program at Harvard Law School. The SRP works on behalf of public pension funds and charitable organizations seeking to improve corporate governance at publicly traded companies in which they are shareowners, as well as on research and policy projects related to corporate governance. Any views expressed and positions taken by the SRP and its representatives should be attributed solely to the SRP and not to Harvard Law School or Harvard University. |
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38 Successful Precatory Proposals at S&P 500 Companies, with Average
Support Exceeding 80%
During the first 8 months of 2012, 38 precatory declassification proposals submitted to S&P 500 companies by SRP-represented investors have won approval, with average support of over 80% of votes cast. The 38 successful proposals submitted by SRP-represented investors constitute almost 40% of the precatory proposals that received majority support so far in 2012.
During the 2012 proxy season, the SRP has been representing and advising institutional investors in connection with the submission of board declassification proposals to about 90 S&P 500 companies. While many of the companies receiving such proposals have entered into agreements committing them to bring management proposals to declassify their boards (as described in a previous story in this newsletter), negotiated outcomes were not reached with a number of other companies and, as a result, shareholder proposals submitted by SRP-represented investors have gone to a vote at 2012 annual meetings.
Of the 40 proposals that have been voted on so far, 38 passed. (In the two cases where proposals failed to gain majority support, they received average support of 48.55% of votes cast.) The table below provides information concerning the proponent and voting outcome for each of the 38 precatory declassification proposals that passed. As the table indicates, these proposals obtained average support of 82.41% of votes cast.
It is hoped that the 38 companies where declassification proposals passed will follow the strongly expressed preferences of their shareholders and bring management proposals to declassify their boards of directors at their 2013 annual meetings.
Shareholder Declassification Proposals Winning Majority Support
| Company |
Proponent |
% of Votes Cast in Favor |
| Airgas, Inc. (ARG) |
LACERA |
63.93% |
| Apache Corporation (APA) |
ISBI |
89.00% |
| Baxter International Inc. (BAX) |
NCF |
98.07% |
| Bemis Company (BMS) |
NCDST |
74.75% |
| Best Buy Co, Inc. (BBY) |
NCF |
97.40% |
| CF Industries Holdings, Inc. (CF) |
LACERA |
92.71% |
| CarMax, Inc. (KMX) |
NCF |
87.29% |
| Cerner Corporation (CERN) |
ISBI |
64.93% |
| Chipotle Mexican Grill, Inc. (CMG) |
ISBI |
89.38% |
| Cognizant Technology Solutions Corporation (CTSH) |
LACERA |
91.13% |
| DENTSPLY International Inc. (XRAY) |
LACERA |
78.36% |
| EQT Corporation (EQT) |
OPERS |
80.98% |
| Edwards Lifesciences Corporation (EW) |
ISBI |
97.59% |
| F5 Networks, Inc. (FFIV) |
ISBI |
77.20% |
| FLIR Systems, Inc. (FLIR) |
NCF |
81.94% |
| FMC Corporation (FMC) |
NCF |
82.65% |
| Hess Corporation (HES) |
NCDST |
77.55% |
| Lexmark International, Inc. (LXK) |
NCDST |
92.82% |
| Limited Brands, Inc. (LTD) |
ISBI |
64.54% |
| Lorillard, Inc. (LO) |
ISBI |
96.35% |
| MEMC Electronic Materials, Inc. (WFR) |
NCDST |
95.54% |
| Masco Corporation (MAS) |
ISBI |
84.52% |
| Moody's Corporation (MCO) |
NCF |
76.94% |
| Netflix, Inc. (NFLX) |
LACERA |
74.66% |
| People’s United Financial, Inc. (PBCT) |
NCDST |
90.61% |
| QEP Resources, Inc. (QEP) |
ISBI |
87.92% |
| Quest Diagnostics Incorporated (DGX) |
ISBI |
93.50% |
| Red Hat, Inc. (RHT) |
LACERA |
95.29% |
| Ryder System, Inc. (R) |
NCDST |
87.67% |
| SCANA Corporation (SCG) |
NCDST |
60.28% |
| salesforce.com, inc. (CRM) |
NCF |
80.52% |
| Snap-On Incorporated (SNA) |
NCDST |
84.87% |
| The J. M. Smucker Company (SJM) |
LACERA |
76.53% |
| US Steel Corporation (X) |
NCDST |
82.48% |
| Urban Outfitters, Inc. (URBN) |
ISBI |
59.99% |
| V.F. Corporation (VFC) |
NCF |
62.74% |
| Vornado Realty Trust (VNO) |
ISBI |
85.61% |
| Vulcan Materials Company |
ISBI |
73.45% |
| |
Average: |
82.41% |
Return to Shareholder Rights Project September 2012 Newsletter
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