Recent Developments in Directors’ Elections: A Comparative Perspective

1. Recent Developments in Directors’ Elections: A Comparative Perspective Marco Ventoruzzo Bocconi University, Milan, Italy PSU Dickinson School of Law ECGI

2. Overview of the “Proxy Access” debate in the US • Example of horizontal and vertical regulatory competition • Are Investors Interested in Board Representation? • Comparative Analysis: From Proxy Access to List Voting?

3. 1. Overview of the “Proxy Access” Debate in the US

4. Directors’ Elections • Plurality voting – Some corporations have adopted majority voting • No shareholders’ access to corporate proxy • NYSE Rule 452 (discretionary voting for uninstructed shares) – amended in 2009

5. 2007 t North Dakota: NDPTCA

7. 2007 2008 2009 - 2010 2011 t SEC approves Rules 14a-11 and 14a-8(i)(8) North Dakota: NDPTCA Delaware Responds: - Sections 112 and 113 DGCL Business Roundtable v. SEC: U.S. Court of Appeal D.C. vacates Rule 14a-11

8. 2. Are Investors Interested?

12. 3. From Proxy Access to List Voting

13. A “diversified” board, with representatives of minority investors, is desirable: • Empirical evidence (see Chernich et alt., 2009); • Controlling function; • Proxy Access is not sufficient to achieve that goal;

14. J M L • Joe • Mary • Linda 24% 4. Rose 6%

15. A “diversified” board, with representatives of minority investors, is desirable: • Empirical evidence (see Chernich et alt., 2009); • Controlling function; • Proxy Access is not sufficient to achieve that goal; • Cumulative Voting v. List Voting

16. J M R • Joe • Mary • Linda • Rose • Rick • Paul 24% 6%

17. marco.ventoruzzo@unibocconi.it