Melissa Sawyer, S&C’s Global Head of M&A and co-head of the Firm’s Corporate Governance Practice, spoke with the Financial Times about the implications of the SEC’s new universal proxy rule, in light of a former Warner Music Group employee’s unsuccessful attempt to use the new rule to nominate herself for a board seat at the company. Adopted by the agency in September, Rule 14a-19 requires boards and shareholders to list the names of both board-nominated and shareholder-nominated director candidates on universal proxy cards in contested director elections.
The rule change may make it easier and more affordable for lesser-known activist groups to launch proxy contests and nominate single director candidates. According to Melissa, the new rule “significantly lowers the cost of running a campaign for activists” because they can now spend less to solicit shareholder votes. (S&C is not involved in the Warner Music matter.)
Read “Warner Music dodges ex-employee’s push for board seat under new SEC rules.”