On November 5, the SEC announced two significant proposals affecting shareholder voting. One proposal would impact proxy advisory firms, requiring them to (1) disclose material conflicts of interest, (2) give issuers the opportunity to review and comment on advisory firm voting recommendations, and (3) provide a hyperlink to the issuer’s response to the advisory firm’s voting recommendation. Items (2) and (3) would be available only to issuers who file definitive proxy statements at least 25 days prior to their annual meetings, and the review period would depend upon the length of the period between the definitive filing and the meeting date. The proposal would also amend the definition of “solicitation” and provide for confidentiality of communications between issuers and advisory firms.

The second proposal would impact shareholder proposals, including (1) changing the holding period (but not the minimum amount of ownership) needed to be eligible to submit proposals, (2) limiting the number of proposals a holder can submit, and (3) increasing the levels of support a proposal must obtain to be resubmitted at subsequent meetings.

Both proposals are subject to a 60-day comment period, and both are likely to generate extensive – and possibly heated – comments from investors and issuers alike. However, because the proposals cannot be acted upon until at least January, they will not be effective for the peak proxy season in 2020.

If you have any questions, please contact Gunster securities law and corporate governance practice leader Bob Lamm or shareholder Gus Schmidt.

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This publication is for general information only. It is not legal advice, and legal counsel should be contacted before any action is taken that might be influenced by this publication.

About Gunster

Gunster, Florida’s law firm for business, provides full-service legal counsel to leading organizations and individuals from its 13 offices statewide. Established in 1925, the firm has expanded, diversified and evolved, but always with a singular focus: Florida and its clients’ stake in it. A magnet for business-savvy attorneys who embrace collaboration for the greatest advantage of clients, Gunster’s growth has not been at the expense of personalized service but because of it. The firm serves clients from its offices in Boca Raton, Fort Lauderdale, Jacksonville, Miami, Naples, Orlando, Palm Beach, Stuart, Tallahassee, Tampa Bayshore, Tampa Downtown, Vero Beach, and its headquarters in West Palm Beach. With more than 260 attorneys and consultants, and over 270 committed professional staff, Gunster is ranked among the National Law Journal’s list of the 500 largest law firms and has been recognized as one of the Top 100 Diverse Law Firms by Law360. More information about its practice areas, offices and insider’s view newsletters is available at


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