Company Explains Basis for Board Override of Director “No” Votes

By Randi Morrison posted 05-24-2021 10:14 PM

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A NYSE-listed company announced that the disinterested members of the board’s nominating and corporate governance committee considered, and then recommended the board reject, the responsive conditional resignation of the independent lead director who received a greater number of “withhold” votes than “for” votes for his election to the board at the company’s 2021 annual shareholders’ meeting. The committee members reportedly evaluated the director’s skills and qualifications and determined that the resignation was not in the best interests of the company. Based on the committee’s recommendation, the board reaffirmed his appointment as lead director and as a member of the three key board committees.

According to Fenwick & West’s most recent “Corporate Governance Practices & Trends” report, 88.3% of the S&P 100 had this rejectable resignation style of majority voting as of last year’s proxy season.

This post first appeared in the weekly Society Alert!

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