Too Busy to Think, Spread Too Thin to Matter: Why Stockholder Voting Should be Less Frequent, More Targeted, and More Thoughtful

I spoke two days ago at the 9th Annual PLI Directors’ Institute on Corporate Governance. Lots of great presentations and provocative suggestions at this event, from such luminaries as Bill Ackman, Ira Millstein, Hillary Sale, Pat McGurn, Richard Parsons, Alan Beller and lots of others. In my comments which you can find in this PDF, I asserted that stockholder meetings are too frequent and involve too many votes on too many items. Stockholder input into corporate governance is cheapened as a result, and would be more valued and valuable if voting were more selectively scheduled and targeted. Managers and investors share a common interest in having their governance dialogue include discussion of how to better focus stockholder voting and eliminate elections and resolutions that have little or no economic significance. State laws compelling the annual holding of stockholder meetings should become more flexible, but are unlikely to do so unless both management and stockholder representatives support that evolution.