One area where women might have a shortage of experience, at least relative to other director candidates, would be the annual general meeting (also called the shareholder’s meeting or the proxy meeting). A great introduction to this important part of public company performance is RR Donnelley’s 2013 Annual Meeting Handbook written this year by Craig Garner and Chris Geissinger of the San Diego offices of Latham & Watkins. The subtitle says it all: “Providing a General Overview of State and Federal Laws and Stock Exchange Rules Relating to Annual Meetings of Shareholders.”
Unlike many other “print-dominated firms” of the past, RR Donnelley has expanded and enhanced its focus to include extensive governance and financial services.
The Handbook begins with a high-level overview of significant legislative provisions that might impact corporate filings and shareholder meetings in the current year. First and foremost is a brief summary of The Jobs Act (which provides filing/procedural exemptions for newly-defined “emerging growth companies” – those with less than $1 billion gross revenues), followed by a summary of the significant Dodd-Frank Act provisions and the implementing SEC rules/regulations that will impact every other filer (heavily-weighted in 2013 by new compensation requirements). Finally, it describes how significant shareholder lawsuits might guide or constrain corporate actions and/or meeting activities.
Next comes a summary of the array of requirements for annual meetings that originate in state corporate law, federal securities laws, exchange listing rules, and corporate charter and bylaw provisions. Mandates covering proxy disclosure arrived with the Exchange Act of 1934 and subsequent SEC rulemaking. The latest steps include the February 2008 SEC rule-making provisions “to facilitate the use of electronic shareholder forums.”
Detailed requirements of proxy materials, notice, content, voting are covered in depth in the next chapter, Federal Proxy Rules and The Proxy Statement. This chapter is a comprehensive “everything you need to know” about drafting or understanding proxy statement content. A separate section explains how the SEC regulators receive and review the material submitted in proxies, followed by comparable reviews conducted by the major listing exchanges.
The Annual Report to Shareholders is described in the next chapter as “… a different document than the proxy statement and the Annual Report on Form 10-K that public companies must file with the SEC, and is subject to much less regulation and supervision by the SEC.”
Shareholder Proposals, their content and review are covered next, describing how shareholders may submit issues for consideration in the annual meeting and the pre-conditions shareholders must meet before their proposals will be considered. How proposals might be excluded by either the company or SEC review is well-presented.
Preparing for the Annual Meeting contains a checklist of all preliminary requirements as well as location, deadlines, order of business, content and procedures – both anticipated and unexpected. The formal transaction of business at the annual meeting is outlined in detail along with follow-up reporting requirements.
In 2000, Section 211(a)(1) of the Delaware General Corporate Law allowed “boards of directors of Delaware companies that are authorized to select the location for their annual meeting to determine that the meeting not be held at a physical location, but instead be held solely by means of remote communication.” Thus, a new consideration relates to managing the electronic shareholder meeting processes, including concurrent or supplemental broadcasts.
If you are a new director candidate, the RR Donnelley 2013 Handbook provides an excellent introduction to everything that a board member needs to know about the shareholder meeting and supporting documentation. If you are an experienced director, it gives a high level overview of key current issues that need to be addressed or considered in the 2013 proxy season filings. If you are a member of the senior management team of a public company, it provides guidelines as you prepare the company and its documents for the public screening of the annual shareholders’ meeting.