Proxy Monitor 2013: Political Spending, Say on Pay, and Other Key Issues to Watch in the 2013 Proxy Season

In recent years, a subset of shareholder activists has sought to advance social or political causes by proposing shareholder resolutions on proxy ballots presented at corporate annual meetings. To study this phenomenon, the Manhattan Institute in 2011 launched its Proxy Monitor project, centered on the ProxyMonitor.org online database, the first publicly available, searchable resource that catalogs shareholder proposals submitted to large corporations (now updated to include the 250 largest U.S. publicly traded companies by revenue, as ranked by Fortune magazine). The ProxyMonitor.org database also includes shareholder-advisory votes on executive compensation, now required at least triennially for all publicly traded companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.[1]

This, the 16th in a series of reports and findings published under the auspices of the Manhattan Institute’s Proxy Monitor project, previews the 2013 proxy season—the period between mid-April and late June when most public companies hold annual meetings.

Part I of this report looks at the 2012 shareholder-proposal record, including submission trends, proposal subject matter, proposal sponsors, and proposals receiving majority support. This analysis contains shareholder-proposal data for all 250 companies in the ProxyMonitor.org database as well as a broader assessment of shareholder-proposal submissions that did not make proxy ballots, as determined through a company survey. A special-focus section examines shareholder proposals seeking further corporate disclosure of political spending, as well as recent regulatory efforts and litigation designed to achieve that end.

Part II surveys executive-compensation advisory vote results for 2012 and discusses a wave of 2012 shareholder litigation based on companies’ executive-compensation advisory vote disclosures. A special-focus section examines the executive-compensation record of the largest proxy-advisory firm, Institutional Shareholder Services (ISS), by tracking its 2011 recommendations against subsequent share-price movement.

Part III looks forward to the 2013 proxy season, with a recap of early shareholder-voting results for companies holding annual meetings in the first six weeks of 2013.

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