Shareholder Rights Project
News Alert

March 13, 2013

The Shareholder Rights Project (SRP) is a clinical program operating at Harvard Law School and directed by Professor Lucian Bebchuk. The SRP works on behalf of public pension funds and charitable organizations seeking to improve corporate governance at publicly traded companies, 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.

Substantial Results Already Produced by Proposals for 2013 Annual Meetings:
46 S&P 500 and Fortune 500 Companies Agree to Move towards Annual Elections

The Shareholder Rights Project (SRP), working on behalf of eight SRP-represented investors, is pleased to announce that proposals submitted for 2013 meetings have already had significant impact:

  • Following active engagement, 46 S&P 500 and Fortune 500 companies that received shareholder proposals for 2013 annual meetings have already agreed to move towards annual elections.
  • These 46 companies represent more than 60% of the companies receiving shareholder proposals from SRP-represented investors for the 2013 proxy season.
  • Together with the 2012 work of the SRP, 91 companies — about three-quarters of the S&P 500 and Fortune 500 companies that received proposals in 2012, 2013 or both — have agreed to move towards annual elections. The aggregate market capitalization of these 91 companies exceeded one trillion dollars as of March 1, 2013.

As described in our November 2012 news alert, the SRP submitted shareholder declassification proposals on behalf of SRP-represented investors to 74 S&P 500 and Fortune 500 companies with classified boards for a vote at their 2013 annual meetings. Following active engagement with companies receiving proposals, 42 companies have entered into agreements to bring management proposals to declassify their boards for shareholder approval (a list of those companies that have already publicly disclosed the agreed-upon management proposals is available here). Furthermore, 4 other companies have declassified by amending their bylaws (where companies' classified board structures are set out in their bylaws, declassification may occur without a shareholder vote). We commend these 46 companies for their responsiveness to shareholder concerns.

In addition to the 42 companies that will put forward management proposals to declassify pursuant to 2013 agreements with SRP-represented investors, 11 companies will put forward management proposals pursuant to agreements entered into following the submission of 2012 proposals by SRP-represented investors. Full details about the management proposals that will be brought to a vote pursuant to 2012 agreements with companies are available in the SRP's 2012 annual report.

The agreements resulting from 2013 proposals, combined with the large number of 2012 declassifications of S&P 500 companies that resulted from engagement with the SRP and SRP-represented investors (described in the 2012 annual report), are expected to bring about a major change in the governance landscape of large publicly traded firms. The SRP expects that, by the end of 2013, the work of the SRP and SRP-represented investors will have contributed to movements toward board declassification by a majority of the S&P 500 companies that had classified boards at the beginning of 2012.

The eight institutional investors on behalf of which the SRP is working are the Illinois State Board of Investment (ISBI), the Los Angeles County Employees Retirement Association (LACERA), the Nathan Cummings Foundation (NCF), the North Carolina Department of State Treasurer (NCDST), the Ohio Public Employees Retirement System (OPERS), the Massachusetts Pension Reserves Investment Management Board (PRIM), the Florida State Board of Administration (SBA) and the School Employees Retirement System of Ohio (SERS). The SRP provides SRP-represented investors with a wide range of services in connection with the submission of shareholder proposals, including submitting proposals on behalf of such investors, and assisting such investors in connection with designing proposals, selecting companies for proposal submission, engaging with companies, negotiating and executing agreements with companies to bring management declassification proposals, and presenting proposals at annual meetings.

Inquiries regarding this news alert should be directed to Emily Lewis, Administrative Director of the SRP, at

Shareholder Rights Project

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