The next few posts will be on the topic of shareholder voting. The SEC recently held the first of three open roundtables on Shareholder Rights and the Federal Proxy Rules. The webcast of the May 7 roundtable on the Federal Proxy Rules and State Corporation Law is now available here. The unofficial transcript of the same event is here.
In light of expected reforms to the SEC’s proxy rules, it seems like an ideal time to catalogue and examine various viewpoints on the purposes and value of shareholder voting rights. To some extent differing viewpoints about the extent to which shareholders should be able to exert control over major corporate decisions can be traced to very different understandings of the added value of shareholder power in the corporate governance system.
To the extent that shareholders add no value or represent a nuisance, the nominal power currently provided under the existing regime seems ideal. To the extent that shareholders could provide an important source of accountability for directors and executives, the need to enhance shareholder rights seems self-evident.
Upcoming posts will highlight current and forthcoming papers on these topics along with commentary regarding the interesting interplay between federal and state rules in this important area of corporate law.