shareholder proposal

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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 ?
Prohibits the Securities and Exchange Commission from amending or otherwise revising the threshold for shareholder proposals or resubmissions under 240.14a-8 of title 17, Code of Federal Regulations, and ensures that retail investors interests are protected and that their voices are heard.
The bylaws include amendments "providing enhanced advance notice disclosure requirements for shareholder proposals of business or director nominations for an annual meeting of shareholders," the company said.
Last year it rushed through shareholder proposals at the business meeting, which had a fraction of the attendees, in less than 30 minutes.
The company's preliminary proxy statement outlines four company proposals and three shareholder proposals. The company proposals include the election of 13 directors, an advisory vote on the compensation of this year's named executive officers and approval of the tax benefit preservation plan.
Further, the company has set 9 April 2019 as the deadline for the receipt of shareholder proposals submitted under Rule 14a-8 of the US Securities Exchange Act of 1934, as amended, for inclusion in IRET's proxy materials for the meeting.
(NASDAQ: AKBA) vote in favour of the shareholder proposals relating to the company's proposed merger with Keryx Biopharmaceuticals (NASDAQ: KERX).
BlackRock's report also showed it voted this year in favor of shareholder proposals at Facebook Inc and Google parent Alphabet Inc to give each shareholder an equal vote on governance matters.
All of the targeted institutions -- Bank of America, MasterCard, American Express, JP Morgan, Wells Fargo and Citi -- rejected shareholder proposals asking for detailed reports on the percentage pay gap between male and female employees across race and ethnicity, including base, bonus and equity compensation, policies to address that gap, the methodology used, and quantitative reduction targets.
"Pension fund managers should refocus their efforts on the wants and needs of their investors, prioritizing investment decisions to maximize performance, while limiting votes to shareholder proposals that directly impact their fund and its members."
* Sustainability reporting: Shareholder proposals requesting companies publish a sustainability report continued to gain traction.
As discussed previously in the 2015 Proxy Statement, the deadline for shareholder proposals for inclusion in the proxy statement for the 2016 Annual Meeting of Shareholders was December 9, 2015.
Executive compensation is a major issue for many boards, but in terms of the raw number of shareholder proposals a company receives, it is not the greatest concern.