Author Archive | James McRitchie

Take Action: Address Proxy Vote Counting Issue in ISS Survey

proxy vote counting fraud

proxy vote counting fraud

There is not an issue of concern to any investor that is not being systematically harmed by unfair proxy vote counting practices. Although it is late in the day, we ask you to weigh in on the ISS survey to ask them to recommend FOR simple-majority voting and counting proposals in the upcoming proxy season.

As I previously reported (ISS Proxy Voting Survey Due Friday at 5:00 pm ET), ISS has circulated a 2016 survey.  They encourage participation from any-and-all (not just ISS clients) so it would be entirely appropriate for all readers to weigh in.

In addition to shareowners, the press has a strong vested interest in doing so. Most reporters must write their stories the day of the AGM (or by the next morning) but the actual vote results are not delivered to the SEC until several days later.  This makes them unwitting mouthpieces for deceptive managers that counts abstentions as no votes. Few reporters go back to correct or augment their story. Thus, we unwittingly help perpetuate an essential myth promulgated by management’s use of variant vote-counting formulas. Continue Reading →

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Video Friday: Interviews with Don Hyatt of ASA

Don Hyatt

Don Hyatt

As part of my series Retail Shareowners – Facilitating Votes and Activism (see Part 1 and Part 2), I have begun looking more closely at the Australian Shareholders’ Association (ASA). In researching their activities I came across the videos below of interviews with Don Hyatt. Most are somewhat dated but they still provide interesting background.  Shareowners in the United States might do well to create an organization modeled after the ASA. Continue Reading →

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Society 2015: Part 5 – Myron T. Steele & More

Society of Corporate Secretaries & Governance ProfessionalsThe last of my notes from the Society’s 2015 National Conference in Chicago, 6/24-27/20015. Part 1, Part 2, Part 3, and Part 4. Sorry to be posting so long after the event but I still find them useful… and going through my notes may help you remember some of the more interesting points if you attended or get some sense of what went on if you did not. Even though it took me months to get them out, they are still cryptic.

More on Twitter at #Society15. If anyone has photos or notes from the panel I was on, “Responding to Shareholder Proposals,” I would appreciate it if you would send copies along to me. Panel members included Elizabeth Ising, Amy Borrus, James McRitchie. Rick Hansen moderated. I had a great time and expect to be negotiating dozens of proxy access proposals next season more smoothly. Thanks again to the Society.
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ISS Proxy Voting Survey Due Friday at 5:00 pm ET

ISS Proxy Voting Survey - Hall of Mirrors

ISS Proxy Voting Survey – Hall of Mirrors

Attention everyone who thinks ISS has too much say over how proxies are voted. It might be a good time for you to see how those policies are actually developed. No, ISS doesn’t develop its policies by reviewing all the academic research to determine which types of proxy proposals create value or are correlated with value creation (Do ISS Voting Recommendations Create Shareholder Value?David F. Larcker, Brian Tayan) Instead, the ISS proxy voting survey essentially asks subscribers to tell ISS how it should advise their subscribers to vote.

When I first heard about this years ago, it felt like looking down a never ending hall of mirrors. You ask me how shareholders should vote; then, when voting time comes, you remind me what I said. Of course, not all ISS clients will have anything to say about every issue and a large number probably do not have the staff to be researching proxy voting issues and policies. It is a little like one of those Lost on the Moon exercises you may have taken in one of your classes on group dynamics. In most cases, the group will be smarter than the individual participants. The same principles apply in creating a proxy voting policy.  Continue Reading →

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Clorox Adopts Proxy Access Lite

cloroxIn response to a proxy access proposal I filed earlier this year, Clorox Co (NYSE:CLX), manufacturer and marketer of consumer and professional products, adopted proxy access (press release, amended bylaws). I am declaring another victory and withdrawing my proposal.

While I filed a standard proxy access proposal seeking the ability of shareholders with 3% of shares held for 3 years to be able to nominate up to 25% of the board, Clorox adopted bylaws allowing nominations only up to 20% and limiting nominating groups to 20, whereas my proposals had no such restrictions on the number of participants in nominating groups. Continue Reading →

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Steris Corporation’s Proxy Voting Deflate-Gate

Steris Proxy Voting Deflate-GateMost companies opposing a shareholder proposal simply rely on an opposition statement, although sometimes they  solicit the votes of their largest shareowners. Steris Corporation (NYSE:STE) took it a bit further. Was it cheating? That depends on your perspective. Like a partially inflated football, a partially stuffed ballot can provide the crucial margin needed to win.

Proxy Voting Deflate-Gate: What Steris Did

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Video Friday: Take Action on Plastic Microbeads

plastic microbeedsI hope those concerned with good corporate governance are also concerned with stewardship. Investors shouldn’t be making money by investing in products that harm the environment. Their are plenty of alternatives to plastic microbeads.

This 2-minute video “explainer” shows how tiny plastic microbeads go down the drain and into our rivers, lakes, and oceans. We can do to stop this ridiculous assault on our public waters.  TAKE ACTION!

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Director, Harvard’s Business and Environment Initiative

Duties & Responsibilities Harvard University logo

The Business and Environment Initiative at Harvard Business School seeks to deepen our collective understanding of the urgent environmental challenges confronting business leaders and to help them use the tools of business to design effective solutions. We aspire to help leaders create the economic and political institutions that will enable firms and societies to thrive while maintaining the physical and biological systems on which they depend. Continue Reading →

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Exec Director: The Conference Board Governance Center

The Conference Board Governance CenterThe Conference Board Governance Center’s current executive director, Donna Dabney, is retiring at the end of the year. It would be great to get someone of her high caliber to fill the position. Please inform your well-qualified colleagues of this great opportunity

The Conference Board Governance Center®

The Conference Board Governance Center® facilitates small groups of prominent senior executives from companies, investors, and advisors for confidential discussions of key issues. The Executive Director leads the Governance Center, develops and executes its strategy to position the center as a globally recognized thought leader in the corporate governance space, sets and delivers the center’s research agenda, disseminates research findings, and serves its members. Continue Reading →

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Society 2015: Part 4 – Axelrod & Activists at Your Door

David Axelrod

David Axelrod

More of my notes from the Society’s 2015 National Conference in Chicago, 6/24-27. Part 1, Part 2 and Part 3. Sorry to be posting so long after the event but I still find them useful… and going through my notes may help me remember some of the more interesting points.

David Axelrod

Believer: My Forty Years in Politics @davidaxelrod I’m not sure why David Axelrod was a featured speaker. Has he played a key role regulating corporations?  Maybe he was there to inspire. I found him inspiring and interesting. “The future is not a gift, its an achievement.” (Bobby Kennedy) There are those who run for office because they want to be someone and those who run because they want to do something. He is troubled by cynicism and went to work for Obama when he ran for US Senate. Continue Reading →

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STERIS Corporation: How I Voted – Proxy Score 86

STERIS logoSTERIS Corporation (NYSE:STE) is a provider of infection prevention and other procedural products and services focused on healthcare, pharmaceutical and research. Steris is one of the stocks in my portfolio added at the end of 2008 for a gain to date of 182%. Their next annual meeting is August 27, 2015. ProxyDemocracy.org had collected the votes of one fund when I checked and voted. I voted with the Board’s recommendations 86% of the time. View Proxy Statement. Continue Reading →

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Video Friday: Ira Millstein on Corporate Governance

Ira Millstein

Ira Millstein

The Open Mind: Corporate Governance a decade later

Although taped on 4/20/2006, this interview with Ira Millstein, Senior Partner, Weil, Gotshal & Manges, was not posted to YouTube until this month. Millstein discusses corporations, corruption, and regulation.  Listen and learn about changes that have been made and some of what remains to be done. In the history of corporate governance, Ira Millstein has occupied a prominent position for several decades.  Continue Reading →

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Most Investment Professionals Consider ESG Issues

ESG Issues IRRCiAlmost three-quarters of investment professionals worldwide (73 percent) take environmental, social, and corporate governance — ESG issues into consideration in the investment process, according to the CFA Institute ESG Survey, a new survey of CFA Institute members created by CFA Institute and the Investor Responsibility Research Center Institute (IRRC Institute). In addition, 64 percent of survey respondents consider corporate governance issues, 50 percent consider environmental issues, and 49 percent consider social issues in investment decisions. Only 27 percent do not consider ESG issues. Continue Reading →

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Sharfman Pans Proxy Access Proposals by Public Pensions

Bernard S. Sharfman

Bernard S. Sharfman

Bernard Sharfman notified me of his post, Public-pension funds play with newest toy in corporate governance, saying: “As you know I am not a big fan of proxy access.” I was looking forward to a thoughtful analysis of the issues but that is not what I found. The R Street blog, where his piece was posted, apparently doesn’t allow comments. Don’t “free markets” and “real solutions” benefit from the free exchange of ideas? Since Sharfman has contributed to the CorpGov.net blog with more serious scholarship, I feel a greater obligation to point out his fallacies. Perhaps, with some dialogue, we will come closer to agreement. I would welcome his comments, as well as those from other readers. Continue Reading →

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Society 2015: Part 3 – Driving Retail and Employee Votes

Driving Retail and Employee Votes

The 2015 National Conference in Chicago, 6/24-27, was my first time attending one of the Society’s events. Part 1 and Part 2. Yes, I’m posting notes late but hopefully they are still useful.

Panelists: Lawrence Dennedy, Irving Gomez, Martin Koopman, Theresa Molly

Driving Retail and Employee Votes

Driving Retail and Employee Votes

In 2001 Prudential switched from a mutual to a public company, so they have an unusually high number of registered shareholders. Proactive shareholder engagement. Plant a tree… get a bio-friendly tote bag. Actively ask on proxy for comments.  ‘Starbucks’ incentive – Offered registered shareholders to move to broker (reduce their expense). Continue Reading →

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