shareholder proposal

Shareholder Proposal

A proposal for a publicly-traded company to take a certain course of action, submitted by a shareholder. Any shareholder who owns more than $2,000 in stock or 1% of the company is permitted to initiate a shareholder proposal. It must be placed on the agenda and put to a vote at the next available annual shareholders meeting, unless the SEC gives the company special permission to exempt it. Generally speaking, a shareholder makes a shareholder proposal to force the company to do something that the management does not want it to do. As a result, management tends to urge shareholders to vote against shareholder proposals, though they may seek a compromise with the shareholders if the proposal is popular.

shareholder proposal

A proposal that is submitted by a shareholder for action at a forthcoming annual meeting. If the holder gives timely notice of his or her intentions, the firm's management must include the proposal in the proxy statement and must give the other shareholders a chance to vote for or against the proposal. Typical shareholder proposals involve voting rights, management compensation, and corporate charitable contributions.

Shareholder proposal.

A shareholder proposal is a resolution that's put forward for consideration at a corporation's annual meeting by an individual shareholder or a group of shareholders rather than by the corporation's board of directors.

A shareholder who has owned at least $2,000 worth of stock or 1% of a company's outstanding shares for at least a year is entitled to offer a proposal.

In most cases, management opposes these proposals and urges shareholders to vote against them. However, management may negotiate with activist investors to make changes in corporate policy to avoid the threat of a shareholder proposal.

A shareholder proposal must be included in proxy materials unless the corporation receives authorization from the Securities and Exchange Commission (SEC) to omit it.

References in periodicals archive ?
In response, Arjuna Capital withdrew its gender pay shareholder proposal.
Under Rule 14a-8, a company is required to include a shareholder proposal in its proxy statement unless the proposal fails to comply with one of the rule's requirements or one of the enumerated bases for exclusion in the rule applies.
The top three shareholder proposal topics are political spending/lobbying; general corporate sustainability and climate change-related reporting (including supplier-issued sustainability reports); and equal opportunity employment policies.
A shareholder proposal requesting a change to a voting requirement was also passed, while two other shareholder proposals, concerning political contributions and the retention of equity awards, were not passed.
This study examines whether the likelihood of a corporate governance shareholder proposal being filed varies with other corporate governance components, specifically leadership structure and/or board composition.
Environmentally and socially conscious activists have tried to remedy this corporate attitude through the shareholder proposal process.
The only shareholder proposal to pass was one changing the voting structure for the election of directors.
A shareholder proposal at last year's meeting called for Wal-Mart to fill two-thirds of its board positions with independent directors.
Knight Ridder shareholders last week narrowly defeated a shareholder proposal to treat stock options as an expense, the company said.
Providence said in a proxy statement that the poison pill would delay the consideration of a shareholder proposal and discourage shareholders from communicating, for fear they would trigger the "poison pill" and have a portion of their stock confiscated.
The second purpose of this paper is to test for subsequent wealth effects after proxy mailing dates for firms that either negotiate a settlement with proposing shareholders or that pass the shareholder proposal at annual meetings.
1) and voted against a shareholder proposal to terminate the investment management agreement between Legg Mason Partners Fund Advisor, LLC and the Fund (Proposal No.

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