It's no accident that today's economy is unfair to working people. The rules have been manipulated for decades by corporate CEOs who choose short-term profits over long-term interests. One of the ways we work to restore balance to our economy is by changing corporate practices through shareholder-driven reforms that are designed to increase corporate accountability.
About Shareholder Resolutions
Working people are shareholders in corporations through their retirement plans and as individual investors. The submission of shareholder resolutions is an important right that investors have to communicate with each other and the companies that they own. These shareholder resolutions are voted on at company annual meetings that are typically held in the spring season.
Many of today’s best practices in corporate governance were established as a result of shareholder resolutions. Examples of these corporate governance reforms include making director elections more democratic, establishing independent board chairs, requiring the use of independent auditors, and limiting abusive executive compensation practices like golden parachutes.
In recent years, corporate social responsibility has become an increased focus area for shareholder resolutions. This reflects a growing recognition that these issues affect company performance. As requested by shareholder resolutions, many companies report on their environmental sustainability, employment diversity, respect for human rights and political spending.
Many shareholder resolution topics eventually become adopted as rules for public corporations. Examples of rules that were first proposed as shareholder resolutions include “say-on-pay” vote requirements on executive compensation, the expensing of stock options that are awarded to senior executives, and director independence requirements for boards and their key committees.
Perhaps because shareholder resolutions are an effective way to increase corporate accountability, trade associations such as the U.S. Chamber of Commerce and the Business Roundtable are now seeking to limit the ability of shareholders to file resolutions. These business groups speak for corporate executives, not shareholders who include working people as investors.