Responding to investor pressure, and pressure by shareholder proponents, the SEC Division of Corporation Finance issued this statement:

“In light of Chair White’s direction to the staff to review Rule 14a-8(i)(9) and report to the Commission on its review, the Division of Corporation Finance will express no views on the application of Rule 14a-8(i)(9) during the current proxy season.”

The statement references public companies that have requested the SEC to permit exclusion of proxy access proposals by stating the shareholder proposal directly conflicts with the issuers own proposal that will be included in the proxy statement.  The practice began when Whole Foods was recently successful in obtaining SEC relief.  See our most recent coverage here.

The SEC sent this reconsideration letter regarding Whole Foods.  All in all, a victory for shareholder propenent James McRitchie.

Chair Mary Jo White released this statement:

The Commission’s proxy rules enable shareholders to submit proposals for inclusion in a company’s proxy materials for a vote at a shareholder meeting, subject to certain procedural and substantive exclusions.  One of the exclusions, Exchange Act Rule 14a-8(i)(9), allows a company to exclude a shareholder proposal that “directly conflicts” with a management proposal.  Due to questions that have arisen about the proper scope and application of Rule 14a-8(i)(9), I have directed the staff to review the rule and report to the Commission on its review.