Shareholders Have Their Say: Say On Pay Developments In U.S. And Canada

Recent U.S. Developments

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) calls for mandatory say-on-pay votes at all annual meetings of U.S. issuers and certain foreign issuers that are subject to the Securities and Exchange Commission's (SEC) proxy rules. Shareholders will also vote on whether they want the vote to occur every one, two or three years. Although both of these votes are non-binding advisory votes, companies and shareholders are paying close attention to the results. In addition, the Dodd-Frank Act requires disclosure of golden parachute arrangements and shareholder approval of such arrangements in connection with meetings held under the U.S. proxy rules to approve acquisition transactions.