Bank of America Joins Proxy Access Trend, Faces Pressure Over CEO-Chairman Merger

Bank of America (NYSE:BAC) has amended its bylaws to allow long-term shareholders to nominate directors, joining a growing trend of major public companies embracing "proxy access." The move comes as a result of pressure from public pension funds, including the California Public Employees Retirement System (CalPERS), which had pushed for the change. Under the new bylaws, shareholders owning at least 3% of BofA shares for at least three years can nominate directors, with up to 20 investors able to pool their stakes to reach the 3% threshold.

Key Takeaways:

• Bank of America has amended its bylaws to allow long-term shareholders to nominate directors, adopting a 3%/20 investors/3-years "proxy access" standard.
• The move follows pressure from public pension funds, including CalPERS, and marks the latest major public company to join the proxy access trend.
• General Electric (NYSE:GE), Prudential Financial (NYSE:PRU), and Citigroup (NYSE:C) have also backed proxy access with the same standard.
• Citigroup has endorsed a shareholder amendment, while Whole Foods Market (NASDAQ:WFM) has resisted, instead opting for a 9%/20 investors/5-years standard.
• Whole Foods has pushed back its annual shareholder meeting to September 15 to allow for further discussion on the proxy access amendment.

Statistics:

• Bank of America has adopted a 3%/20 investors/3-years proxy access standard.
• General Electric, Prudential Financial, and Citigroup have also adopted the 3%/20 investors/3-years standard.
• Whole Foods Market has adopted a 9%/20 investors/5-years standard.
• Up to 20 investors can pool their stakes to reach the 3% threshold.
• Bank of America's bylaw amendmenttook effect on Friday.

Sources:

• Investopedia, List of Proxy Access Companies
• SEC, Proxy Access FAQs
• IBD, Bank of America to Give CEO, Chairman Roles to Brian Moynihan