The Advisors' Blog

Liz has blogged about the advance proxy voting disclosure initiatives of various institutional investors on our Proxy Season Blog on TheCorporateCounsel.net, including Neuberger Berman’s NB Votes initiative. As part of that initiative, now in its fourth year, NB recently announced that it’s voting against the directors of one company due to low share ownership levels and related company policies. Here’s an excerpt:

Regarding share ownership, we encouraged the company to make share ownership guidelines mandatory and increase ownership requirement for management and directors. Further, we have concerns regarding a notable lack of insider purchases during a period when the company shares are at a decade’s low. In our view, it is imperative for management and the board to maintain a significant equity ownership in the company not only to ensure alignment with shareholders’ interests, but also to signal to the market a renewed commitment to protecting and enhancing shareholder returns.

…Due to our concerns about the lack of share ownership at the board level we intend to oppose the election of all independent directors who do not meet the company’s current, voluntary guidelines.

Check out our “Stock Ownership Guidelines” Practice Area for checklists, sample guidelines and a monitoring chart to help you keep tabs on compliance by your officers and directors.

– Meredith Ervine