Attempts had been underway for some time for changes in the way proxy votes are permitted and counted. Under the new Dodd-Frank Act some have been finally legislated.
Street name votes must now have consent of the share beneficiaries. There are now nonbinding shareholder votes on compensation-related issues. Governance changes and board of directors compensation committee changes were also enacted.
Like other added restrictions on business, they serve little purpose, other than a play to a voter block that feels the corporation’s primary care is not its product or service, jobs and profits that enable it to operate, but to seek secondary social goals, almost simultaneously.
Anyone with hands-on business experience knows it is impossible to focus on both at the same time and be profitable. Only community organizers and social scientists with no top-level business experience think that way.
This fine-tooth-comb meddling is actually unfair to most shareholders because many activist minority shareholders are not really interested in genuine company matters. Their primary goals are societal concerns that ought to be rectified by federal, state and local government, not private corporations.
For years, they have clamored for changes in corporate activity which the vast majority of shareholders would not want. Today, corporations are being nudged by government to actually submit much of the proposals into their proxies.
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