As calendar year-end companies gear up for their annual shareholder meetings, one question looms large: Will shareholders follow management’s recommendations when they vote? Companies can typically count on shareholder support for routine matters—such as electing unopposed directors, and appointing auditors for the next fiscal year—but non-routine business is another matter. If a dissident shareholder launches a “withhold vote” campaign or a proxy fight, companies need to know how other shareholders will react. Management wants to be sure that shareholders will vote in favor of proposed equity-related compensation plans, too.
