In-person meetings or telephone dialogues are the most common ways in which the Interfaith Center on Corporate Responsibility (ICCR) and SRIC members conduct corporate engagements. In some cases, these discussions follow a regular calendar, and/or meetings are requested either by investors or management to address a specific issue or concern. Because SRIC & ICCR members have cultivated their relationships with corporate management and are viewed as serious long-term investors interested in improving the performance and sustainability of the companies they hold, these dialogues are conducted in an environment of mutual respect and in the spirit of finding common ground and resolution to investor concerns.
Participants in corporate dialogues often include CEOs, board members, investor relations representatives, corporate secretaries, legal counsel, and sustainability officers. Shareholders are represented by a lead investor who is responsible for the agenda. It is not uncommon for ICCR members to invite other stakeholders or representatives from Non-Government Organizations (NGOs), community groups, and subject matter experts advocating on any given issue to join the conversation as a way to build bridges between companies and the communities impacted by their operations. Participants in dialogues are bound to observe Chatham House rules (i.e., the discussion is considered “off the record” and quotes are not specifically attributable to any of the dialogue participants).
Filing Shareholder Resolution
Proxy resolutions (or shareholder proposals) are generally used as a last resort when investor concerns aren’t adequately addressed by management. Resolutions appear on the company’s proxy statement and are voted on by all shareholders at the company’s annual shareholder meeting. By virtue of their public nature, resolutions can be an effective press/public relations lever.
The guidelines for filing a shareholder resolution that would meet the criteria of the Securities and Exchange Commission (SEC) are specific. These include:
An institution or individual must:
- Hold $25,000 worth of a company’s stock continuously for 1 year before the date the proposal is submitted; OR
- Hold $15,000 worth of a company’s stock continuously for 2 years before the date the proposal is submitted; OR
- Hold $2,000 worth of a company’s stock continuously for 3 years before the date the proposal is submitted.
- You must also continuously hold your stock through the date of the company’s annual general meeting or be barred from re-submitting that resolution at the company for 2 years.
Each resolution must be written in 500 words or less. resolutions contain a formal resolved clause, which is a specific request or “ask,” with a number of carefully-researched rationales in the form of “whereas clauses” as supporting statements. You must submit your resolution to the company by its filing deadline and adhere to rules regarding word length and phrasing After a resolution is filed, it goes to a vote at the annual general meeting (AGM).
A company can challenge your resolution at the SEC, in which case you will need to file an appeal. If you win the appeal at the SEC your resolution will appear on the company proxy statement.
If you are refiling a resolution that has previously been filed at the company, be aware that it must have reached the following vote thresholds to be eligible for refiling:
- 1st Year Vote: 5%—A new resolution must be approved by at least 5% of shareholders to be eligible for refiling a second time;
- 2nd Year Vote: 15%—A resolution filed a second time must be approved by at least 15% of shareholders to be eligible for refiling a third time;
- 3rd Year Vote: 25%—A resolution filed a third time (and every time thereafter) must be approved by at least 25% of shareholders to be eligible for refiling.
In addition, a resolution that is omitted cannot be refiled for 3 years.
Attending Shareholders Meetings
Fliers must attend the shareholder meeting to promote their resolution(s). Each company has different requirements for entry into an Annual General Meeting (AGM). Some companies ask to have verification of stock ownership and proxy letters in hand. It is of utmost importance to obtain details from the Corporate Secretary/Legal Counsel well ahead of the AGM to guarantee admittance to the meeting.
One of the filers or a representative must attend the company’s AGM to formally ‘move’ the resolution by reading a prepared statement—ask in advance for how much time is allowed (3 minutes is common). Note: If no one appears at the AGM to present a resolution, it will be thrown out and filers will be barred from raising that issue on the proxy ballot for the next three years.
If the company takes no action or loses its SEC challenge, then the resolution will be voted on by all shareholders prior to the Annual General Meeting (AGM). Prior to the vote, the Company sends instructions to shareholders instructing them on how to file their vote. It is very important that members vote on proxy resolutions that have been filed. A list of Shareholder Resolutions can be found in the Proxy Resolutions Book published by ICCR.
How to Reach Us
SRIC is an exempt organization as described in Section 501(c)(3) of the Internal Revenue Code; our Tax ID is 74-2846727. All contributions are tax-deductible. For more information, please contact Anna Falkenberg, PhD, Executive Director:
285 Oblate Drive
San Antonio TX 78216