Join Jim McRitchie, proxy advisor John Glenn Grau and activist investor Michael Levin to discuss ESG via UPC:
How can those concerned with environmental, social, and governance (ESG) issues use new universal proxy card (UPC) rules to run proxy contests? Could electing an ESG director have more impact than winning a dozen shareholder proposals? We use Amazon.com as a potential example.
In November 2021, the U.S. Securities and Exchange Commission issued final regulations requiring companies to use the Universal Proxy Card (UPC), in all contested board of directors elections, or proxy contests. UPC is one of the most significant rules affecting activist investors and proxy contests in decades. It potentially lowers the potential cost of a proxy contest materially, and changes dramatically the strategy and tactics in planning and executing a proxy contest.
UPCs will change how activist investors solicit proxies for director elections and likely lead to both more proxy contests and more activist directors. Activist investors will need to decide how to comply with some specific rules about how many proxies to solicit, and how much they wish to streamline the solicitation process by relying on the company UPC.