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Shareholder Wins Bid to Amend Audit Committee Rules

Tammy Whitehouse | February 24, 2015

Citigroup did not succeed in its bid to set aside a shareholder proposal that would bar a person from joining the audit committee if there’s some bankruptcy history on that individual’s resume.

In a letter from the Securities and Exchange Commission, Citigroup learned the staff did not buy the company’s assertion that a shareholder proposal to pursue a bylaw amendment regarding audit committee service should be excluded from the company’s proxy statement. Activist shareholder John Chevedden proposed an amendment that would bar someone from serving on Citigroup’s audit committee if that same individual was a director at a public company when the company filed for “Chapter 11” reorganization under bankruptcy law.

In his proposal, Chevedden...

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