December 7, 2011

Institutional Investor Files Six Proxy Access Proposals – and Advice on How to Handle Them

Yesterday, Ted Allen of ISS blogged about how Norges Bank Investment Management (NBIM) became the first institutional investor to submit proxy access shareholder proposals this proxy season. NBIM filed them at Wells Fargo, Charles Schwab, Western Union, Staples, Pioneer Natural Resources and CME Group as noted in its press release. Rumor has it that these proposals are in the form of a binding bylaw.

Just before this news broke, I had taped this podcast with Chuck Nathan of Latham & Watkins, who provides some insight into his newly drafted model proxy access bylaw for private ordering, including:

– What sorts of proxy access alternatives do companies have now?
– What is the optimal time for companies to implement something in response to private ordering?
– How complex is your model form of access bylaw?

Last week, CII issued this statement about access proposals.

Compensation Lawsuits: They Keep Coming

Here is something that I blogged on’s “The Advisors’ Blog“: Recently, I blogged about the spate of Section 162(m)-based lawsuits that increasingly are in vogue. The latest one of those was filed against Allergan in Delaware last week (here’s the complaint).

Now we have a new breed of lawsuit – or perhaps it’s more accurate to call it a retread of a vein of old-fashioned pay suits – because it’s not a say-on-pay or Section 162(m) lawsuit, but rather a breach of fiduciary duty – with a helping of alleged self-dealing – suit filed against Ralph Lauren last week in the New York Supreme Court. Even though there was a negative ISS recommendation, the company’s say-on-pay received 96% support (84% when backing out management’s ownership) Founder Ralph Lauren has voting control of the company though Class B shares and it’s deemed a “controlled company” under NYSE rules. The complaint is posted in our “Comp Litigation” Portal. Steven Kittrell notes these allegations in his “Just Compensation” Blog:

– Ralph Lauren Company made a large donation to a charity “affiliated” with a member of the compensation committee;

– One compensation committee member is a “Class B” director. Class B directors are elected solely by Class B stock that is owned only by Ralph Lauren and his family;

– The compensation committee did not hire a compensation consultant in the last year, but got recommendations from management’s compensation consultant for review.

Steven concludes that this case is unlikely to go to trial – and while that is always the best assumption because these cases rarely do, the complaint has a load of allegations that don’t pass the “stink” test giving this case somewhat of a “Disney-esque” quality to it…

The AFL-CIO is hosting a free event on Monday entitled “Executive Pay and the Dodd-Frank Wall Street Reform and Consumer Protection Act” in DC. Come say hello if you attend too…

iPads in the Boardroom: 20 Issues to Consider

Tune in tomorrow for the webcast – “iPads in the Boardroom: 20 Issues to Consider” – to hear Jennifer McGarey of Northrop Grumman, Gina Merritt-Epps of South Jersey Industries, Alicia Myara of Freddie Mac and Kerry Radich of Chevron provide practical guidance about issues to consider and obstacles to overcome involving the use of iPads in the boardroom.

– Broc Romanek