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Let's Make Proxy Season Fun Again

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It's that time of year, to sift through all of the statements and ballots and missives from Carl Icahn. Time, maybe, for a few trips to whatever godforsaken hellholes these companies choose to make their headquarters. Time, all of it, to be bored to death. But not if Myra K. Young has anything to say about it; her potentially tranformative idea? Make every annual general meeting an awards show.

Shareholder Myra K. Young has submitted a proposal to be included on Caterpillar’s annual-meeting ballot asking fellow stockholders: “Which of the following proxy advisors do you think deserve cash awards for the usefulness of information they have provided to Caterpillar shareowners?” Presumably, a list including ISS, Glass Lewis and smaller rivals like Egan-Jones Ratings Co. would follow.

Ms. Young suggests a first prize of $20,000, a second prize of $15,000, a third prize of $10,000 and a fourth prize of $5,000. She said stoking competition among the firms could lead to better and more transparent advice.

Caterpillar has asked the Securities and Exchange Commission for permission to exclude the measure from its ballot. SEC rules permit companies to ignore shareholder proposals under certain circumstances….

Ms. Young submitted similar proposals at Costco Wholesale Corp. and Inc. in 2012 and Cisco Systems Inc. in 2013, according to regulatory filings. Costco and Amazon were allowed to omit the measure, with regulators in Amazon’s case noting that “the proposal seeks to micromanage the company to such a degree that exclusion of the proposal is appropriate.”

Cisco was not. The proposal received support from less than 1% of shares cast at its November meeting.

Proposal Pits Shareholder Advisers Against Each Other—For Cash Prize [WSJ MoneyBeat blog]


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