The Shareholder Commons Reaches Agreement to Withdraw Shareholder Proposal
Broadridge commits to disclose additional information regarding the effectiveness of its proxy services, including information security, vote count accuracy, and regulatory compliance, and to explore select climate change initiatives
WILMINGTON, Del., Oct. 18, 2021 /PRNewswire/ -- The Shareholder Commons announced an agreement with Broadridge Financial Solutions, Inc. ("Broadridge" or "the Company") in which Broadridge will provide greater transparency regarding its role in the shareholder communications and proxy voting process, information security practices, vote count accuracy, and regulatory compliance. The Shareholder Commons and Broadridge also agreed about the importance of two initiatives related to climate change, which Broadridge committed to explore.
Broadridge will seek to provide additional information regarding the most recent regular independent reviews of its proxy processes performed by a leading audit firm. Broadridge has agreed to expand its existing practice of publishing its proxy service performance reports by also publishing summary information regarding the regular independent performance reports it customarily commissions. Broadridge has long engaged the services of an independent public accounting firm to prepare performance reports on the Company's delivery of various aspects of its proxy services, such as proxy voting and information security, and the Company will provide the most recent reports to the proponent and publish summarized information from these reports.
Additionally, and consistent with its already existing commitments regarding reducing greenhouse gas emissions, Broadridge has agreed on the importance of exploring science-based targets for carbon reduction and membership in an industry alliance dedicated to global achievement of net zero greenhouse gas emissions by 2050. Between 2013 and 2019, Broadridge reduced its greenhouse gas emissions by 24% and has a target to further reduce its emissions by 15% by 2025. In connection with this process, Broadridge is reviewing the objectives and required commitments for longer-term carbon reduction and initiatives and will provide an update on this process.
Mr. McRitchie, a long-time Broadridge shareholder, had worked with The Shareholder Commons to submit a shareholder proposal asking the Company to convert to a public benefit corporation (a "PBC"), and to adopt a specific public benefit of contributing to accurate, timely, cost-effective, and transparent proxy voting for diversified investors. Broadridge asked the U.S. Securities and Exchange Commission (the "SEC") to allow it to exclude the proposal from its proxy statement. The SEC declined to exclude the proposal, stating that "the Company's corporate structure is not a matter relating to the conduct of its ordinary business operations, but rather, an important issue that is appropriate for stockholders to address at a meeting."
Mr. McRitchie has now withdrawn the proposal in recognition of Broadridge's agreement discussed above. Each of these measures will address systemic matters that are of concern to many shareholders—an accurate proxy voting system, and the threat to the earth's environment posed by climate change.
"We are pleased this process has established that shareholders have a right to vote on proposals to convert companies to PBCs, including proposals that request a specific public benefit," said Frederick Alexander, CEO of The Shareholder Commons. "We are equally excited to see Broadridge recognize the needs of its diversified shareholders by seriously addressing its carbon footprint and increasing the transparency around its role in the proxy process, which is critical to the corporate governance systems that protect those shareholders."
"Broadridge appreciates the opportunity to engage with all of our shareholders and listen to their concerns and ideas about how to make Broadridge a stronger company," said Edings Thibault, Head of Investor Relations, Broadridge.
"I am a long-time investor in Broadridge, but I also have diversified holdings. More importantly, we all live on the same planet and depend on the same global economy. I'm thrilled to see Broadridge recognizes that its practices affect its shareholders in many ways, and not just through financial return," said Mr. McRitchie.
The Shareholder Commons supports proponents in influencing corporate behavior that threatens social and environmental systems that underpin the global economy. On September 14, 2021, The Shareholder Commons initiated an investor campaign to convert media corporations to PBCs with a specific purpose of providing accurate information. The first step in the campaign is asking shareholders to vote FOR on a shareholder proposal that will be presented at the Fox Corporation (FOX) annual shareholders meeting on November 10, 2021. The campaign is described here: https://theshareholdercommons.com/media-markets-and-systemic-risk/.
About the Shareholder Commons
The Shareholder Commons is a non-profit organization that seeks to shift the paradigm of investor thinking away from a narrow and harmful focus on individual company value toward a systems-first approach to investing that better serves beneficiaries. Learn more at https://theshareholdercommons.com/.
Media Contact: Sophie Faris, Chief Operating Officer
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SOURCE The Shareholder Commons
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