Shareholders Push Companies to Preserve Proxy Proposal Rights as SEC Weighs Repeal

Investor advocates are pushing companies to preserve their rights under Rule 14a-8, an 84-year-old regulation that requires annual votes on shareholder proposals. The Securities and Exchange Commission (SEC) is seeking to repeal this rule, but before it does, shareholders are going straight to the source - the companies themselves.

James McRitchie, an independent shareholder advocate, has written to Costco Wholesale Corp asking them to oppose the SEC's plans in public comments. Zevin Asset Management contacted its 30 portfolio companies mid-September, urging them to speak out publicly against the proposal and express concerns to the agency's commissioners.

The National Legal and Policy Center's shareholder arm submitted resolutions earlier this year at several companies, including Microsoft Corp, which agreed in August to keep accepting proposals that meet existing stock ownership requirements for one year. This move was seen as a compromise before the SEC makes its final decision.