SEC making access to ballot easier

by Marcy Gordon for The Associated Press, August 25th, 2010.

WASHINGTON — Federal regulators are moving to make it easier for shareholders to nominate directors of public companies, a major change long sought by investor advocates and buttressed by the new financial overhaul law.

The action by the Securities and Exchange Commission will allow groups that own at least 3 percent of a company’s stock to put their nominees for director on the annual proxy ballot sent to all shareholders. Getting their candidates on the board gives them a better shot at influencing company policy. It likely will be in place in time for next spring’s corporate elections season — and observers say it may be used to target boards of some companies.

The five-member SEC was expected to adopt the change at a meeting Wednesday.

With more than 600 billion shares being voted each year, the proxy system is a key element of corporate governance. Under the current system, dissident investors must wage costly proxy fights and appeal to shareholders at their own expense if they seek new directors on a company’s board or a bylaw change. (continue reading… )

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