52 Successful Precatory Proposals by SRP-Represented Investors
This page provides information about the 52 successful precatory board declassification proposals submitted by the SRP and SRP-represented investors for a vote of shareholders at 2012 and 2013 annual meeting of S&P 500 and Fortune 500 companies, as well as the significant number of additional precatory declassification proposals that are expected to pass at 2013 annual meetings by the end of 2013. As explained in further detail below:
- 39 precatory board declassification proposals (95% of proposals by SRP-represented investors that went to a vote) passed at 2012 meetings, with average support exceeding 82% of votes cast; and
- 13 precatory board declassification proposals (93% of proposals by SRP-represented investors that have gone to a vote at 2013 annual meetings) passed at 2013 meetings, with average support exceeding 78% of votes cast.
As described in the Negotiated Agreements page, through active engagement with companies receiving declassification proposals, the SRP and the institutional investors working with the SRP have been able to reach negotiated outcomes with many of the S&P 500 and Fortune 500 companies receiving proposals in 2012 and 2013. In other companies receiving proposals, however, the SRP and the institutional investors working with the SRP have not been able to obtain such negotiated outcomes and proposals therefore went to a vote.
Successful 2012 precatory proposals: Altogether there are 41 S&P 500 companies where shareholder proposals by SRP-represented investors went to a vote at 2012 annual meetings.
Of the 41 proposals that went to a vote in 2012, 39 proposals (listed in Panel A of Table 1 below) passed. These 39 successful proposals represented more than 60% of the shareholder proposals by public pension funds that received majority support in 2012, and more than 30% of all precatory shareholder proposals (by all proponents) that received majority support in 2012.
The 39 successful proposals received average support of 82% of votes cast, a substantial majority of the shareholders voting on the proposal (the two proposals that did not pass achieved average support of 48% of votes cast). It is expected that a significant proportion of these 39 companies will follow the clearly-expressed preferences of their shareholders, and the SRP and SRP-represented investors have been engaging with these companies to facilitate such outcomes.
In particular, the boards of eight companies where proposals passed (listed in Panel B of Table 1 below) have already announced moves in the direction recommended by the shareholders. At three of these companies, where the classified board structure was established in the bylaws (which, unlike certificates of incorporation, can be amended by boards without shareholder approval), boards implemented the preferences expressed in the shareholder votes by amending the bylaws of the corporation to eliminate the classified board. In addition, five companies where shareholder proposals passed have publicly announced that they will bring management declassification proposals at their 2013 annual meetings. It is expected that a significant number of additional companies will also move towards annual elections during the course of 2013.
Successful 2013 precatory proposals: Of the S&P 500 and Fortune 500 companies where shareholder declassification proposals submitted by SRP-represented investors are expected to be voted on in 2013, proposals have already gone to a vote at 14 companies. Of these companies, 13 proposals passed (listed in Panel A of Table 2 below), receiving average support of 78% of votes cast (the one proposal that did not pass achieved a support of 49.8% of votes cast).
Many additional precatory declassification proposals are expected to pass by the end of 2013 as additional proposals submitted by the SRP on behalf of SRP-represented investors go to a vote at 2013 annual meetings. Panel B of Table 2 below lists those of the S&P 500 and Fortune 500 companies where that have already publicly announced the precatory declassification proposals planned to go to a vote. Table 2 will be updated periodically as additional precatory proposals submitted by the SRP on behalf of SRP-represented investors go to a vote at 2013 annual meetings and as additional companies publicly announce such proposals. As was the case with successful 2012 proposals, it is expected that board declassifications will result from a significant proportion of the successful 2013 proposals that pass.
| Company | Proponent |
| Panel A: 2012 Precatory Proposals that Passed | |
| Airgas, Inc. (ARG) | LACERA |
| Apache Corporation (APA) | ISBI |
| Baxter International Inc. (BAX) | NCF |
| Bemis Company (BMS) | NCDST |
| Best Buy Co, Inc. (BBY) | NCF |
| CF Industries Holdings, Inc. (CF) | LACERA |
| CareFusion Corporation (CFN) | LACERA |
| CarMax, Inc. (KMX) | NCF |
| Cerner Corporation (CERN) | ISBI |
| Chipotle Mexican Grill, Inc. (CMG) | ISBI |
| Cognizant Technology Solutions Corporation (CTSH) | LACERA |
| DENTSPLY International Inc. (XRAY) | LACERA |
| EQT Corporation (EQT) | OPERS |
| Edwards Lifesciences Corporation (EW) | ISBI |
| F5 Networks, Inc. (FFIV) | ISBI |
| FLIR Systems, Inc. (FLIR) | NCF |
| FMC Corporation (FMC) | NCF |
| Hess Corporation (HES) | NCDST |
| Lexmark International, Inc. (LXK) | NCDST |
| Limited Brands, Inc. (LTD) | ISBI |
| Lorillard, Inc. (LO) | ISBI |
| MEMC Electronic Materials, Inc. (WFR) | NCDST |
| Masco Corporation (MAS) | ISBI |
| Moody's Corporation (MCO) | NCF |
| Netflix, Inc. (NFLX) | LACERA |
| People’s United Financial, Inc. (PBCT) | NCDST |
| QEP Resources, Inc. (QEP) | ISBI |
| Quest Diagnostics Incorporated (DGX) | ISBI |
| Red Hat, Inc. (RHT) | LACERA |
| Ryder System, Inc. (R) | NCDST |
| SCANA Corporation (SCG) | NCDST |
| salesforce.com, inc. (CRM) | NCF |
| Snap-On Incorporated (SNA) | NCDST |
| The J. M. Smucker Company (SJM) | LACERA |
| US Steel Corporation (X) | NCDST |
| Urban Outfitters, Inc. (URBN) | ISBI |
| V.F. Corporation (VFC) | NCF |
| Vornado Realty Trust (VNO) | ISBI |
| Vulcan Materials Company (VMC) | ISBI |
| Panel B: Companies Announcing Moves Towards Annual Meeting Following Successful 2012 Precatory Proposals | |
| Apache Corporation (APA)
(Company Filing) |
ISBI |
| Bemis Company (BMS) (Bylaw Amendments) |
NCDST |
| CF Industries Holdings, Inc. (CF) (Company Filing) |
LACERA |
| F5 Networks, Inc. (FFIV) (Company Filing) |
ISBI |
| MEMC Electronic Materials, Inc. (WFR) (Company Filing) |
NCDST |
| Quest Diagnostics Incorporated (DGX) (Company Filing) |
ISBI |
| Urban Outfitters, Inc. (URBN) (Bylaw Amendments) |
ISBI |
| V.F. Corporation (VFC) (Bylaw Amendments) |
NCF |
| Company | Proponent |
| Panel A: 2013 Precatory Proposals that Passed | |
| Air Products and Chemicals, Inc. (APD) | PRIM |
| Ashland Inc. (ASH) | PRIM |
| BorgWarner, Inc. (BWA) | NCF |
| Costco Wholesale Corporation (COST) | PRIM |
| Huntsman Corporation (HUN) | SBA |
| Jacobs Engineering Group Inc. (JEC) | PRIM |
| Kellogg Company (K) | NCDST |
| NCR Corporation (NCR) | SBA |
| Rockwell Collins, Inc. (COL) | PRIM |
| SCANA Corporation (SCG) | SERS |
| Teradata Corporation (TDC) | NCDST |
| Varian Medical Systems, Inc. (VAR) | PRIM |
| United States Steel Corporation (X) | NCDST |
| Panel B: 2013 Precatory Proposals to be Voted on (Partial) | |
| Foot Locker, Inc. (FL) | NCDST |
| Jarden Corporation (JAH) | NCDST |
| Netflix, Inc. (NFLX) | SBA |
| Vornado Realty Trust (VNO) | ISBI |
| WESCO International, Inc. (WCC) | LACERA |