Thursday, 14 March 2013

USA: the annual election of directors

The Shareholder Rights Project reports, in its March 2013 bulletin published yesterday, the results of its campaign seeking annual election of company directors: approximately three quarters of the S&P 500 and Fortune 500 companies that received proposals in 2012, 2013 or both, have agreed to move towards annual elections.

It's worth noting that the UK's Corporate Governance Code, in code provision B.7.1, provides that all directors of FTSE350 companies should be subject to annual election by the shareholders. This provision was introduced in 2010 and is subject to 'comply or explain'. Annual election has, however, become the norm with the Financial Reporting Council reporting last December that over 95% of FTSE350 companies are holding annual elections: see here (pdf).

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