Last week, the SEC voted to issue a new rule proposal intended to
"modernize" the shareholder proposal rules, with
Commissioners Robert Jackson and Allison Lee dissenting. Generally,
the proposal would modify the criteria for eligibility and
resubmission of shareholder proposals; provide that a person may
submit only one proposal per meeting, whether as a shareholder or
acting as a representative; and facilitate engagement with the
proponent. As anticipated, at the meeting, the commissioners
expressed strong views on these issues, with Chair Jay Clayton
observing that a "system in which five individuals accounted
for 78% of all the proposals submitted by individual
shareholders" needs some work, and Commissioner Jackson
characterizing the proposal as swatting "a gadfly with a
sledgehammer." The proposal is subject to a 60-day comment
period.
