The proxy access movement potentially took a giant leap forward in January when Western Union made the dramatic decision to submit a No-Action Letter to the Securities and Exchange Commission seeking to exclude a proxy access shareholder proposal from Norges Bank Investment Management (NBIM). In its place, Western Union wants to submit its own proxy access plan at its upcoming annual meeting, which would allow shareholders to nominate directors if they own 5 percent of the stock for at least three years. Under the Norges Bank proposal, shareholders would be able to nominate directors if they own at least 1 percent of the shares for one year.
If the SEC approves the request, Western Union would become the first major company to implement a proxy access policy since the regulator gave eligible shareholders permission to require companies to include proxy access resolutions in company proxy materials. Experts also think it could lead other companies that are targets of proxy access proposals to take similar action, preventing shareholders from voting on a softer proposal.
In its No-Action Letter, Western Union asserts that it is submitting a management proposal under Rule 14a-8(i)(9) that conflicts with the shareholder measure seeking to amend its bylaws. Therefore, Western Union argues, a vote on both proposals “could lead to an inconsistent, alternative, ambiguous and conflicting mandate from stockholders.” Western Union would clearly rather its shareholders only consider its more restrictive proposal.....