Universal Proxy Developments: SEC Interpretations and ISS Special Situations Research Note

The universal proxy rules will apply to all shareholder meetings held on or after September 1, 2022. Last week, the SEC issued three Compliance and Disclosure Interpretations (CDIs) on the universal proxy rules and ISS’ Special Situations group issued a Research Note providing its preliminary views on universal proxy matters. The SEC’s CDIs address over nominations of directors, situations in which there are multiple activist slates, and disclosure of the Rule 14a-19 universal proxy deadline in proxy statements. The ISS Research Note provides that boards “will be far less able to shield their weakest contributors” and also indicates some initial skepticism of proxy contests that are purely focused on ESG issues. We have prepared the following client alert discussing these developments.