Vanity: "shareholder right to act by written consent"

Upcounsel ^ | April 2, 2022 | no byline

[sitetest]

The article in the link is provided yo give a definition of the term "shareholder right to written consent."

Here are the first few paragraphs:

Shareholder Action by Written Consent Shareholder action by written consent refers to corporate shareholders' right to act by written consent instead of a meeting.3 min read

1. Meetings Versus Consent 2. How Does Shareholder Action by Written Consent Work? 3. Written Consent Proposals

Shareholder action by written consent refers to corporate shareholders' right to act by written consent instead of a meeting. This type of consent avoids some of the negative characteristics of shareholder meetings. A consent resolution, formally called a Shareholders' Consent to Action Without Meeting, is a written document that details and validates the procedures taken by shareholders within a corporation without requiring that a meeting occur between shareholders and/or directors.

In general, written shareholder consents require the same number of approval votes as would be required if the shareholder meeting actually occurred. Keep in mind that it's not necessary for a meeting to actually be in person these days either, as telephone and video meetings are common and may be included as acceptable methods of holding meetings according to a corporation's bylaws.

Shareholder action by written consent is also known as:

Shareholders' Consent to Action Without Meeting. Notice of Action by Written Consent. Shareholders' Written Consent to Action. Action by Unanimous Written Consent.

[sitetest]

This is on a proxy statement I received from one of the companies in which I'm invested.

I'm trying to obtain information on whether this is a good idea or a bad idea. What I can see on-line all says it's a great idea.

Which worries me.

Is this just another way to make corporations bow even more to the agenda of the demonic woke leftist scum?

Or is it an innocent, good idea whose only effect is to make companies more agile?

Opinions please, especially those that point out the flaws and warts of this idea.

Looking especially for opinions of highly-knowlegeable investors.

[Does so]

.

[calenel]

When I was still a software developer, I wrote an application to automate what you are just seeing the tip of for a law firm that handles literally hundreds of corporations of all types spread out over several states. Old, respectable firm.

This is routine, intended to keep corporations “agile”, yes, but also to keep the corporations legally up to date and current. My application automated virtually all of it, constructing various documents, plugging in the names, positions, etc., of the officers/directors/shareholders, the corporations, addresses for same and tailoring the documents to the type of corporation, the state it operated in, blah, blah, blah.

The end result was that the documents were stuffed and mailed to the clients, who then signed and returned them to the law firm. Bingo, bango, done. From that point, the law firm handled most things such as annual reports filed with the state (which we later converted from paper filings to fully electronic for many of them), changes in assets, stock transactions and what ever else was delegated to the lawyers.

So, anyway, as I said, this is routine. It is intended to facilitate the process of keeping everything in order and legal. I was not an investor, but I am familiar with the purpose and function by virtue of having automated it from a process involving countless lawyers and hundreds of hours of work often afflicted with clerical errors to a couple of days of envelope stuffing and data entry managed by a few paralegals. I would say go for it.

[FlingWingFlyer]

Look at the wonderful job they did “grooming” Hannah Montana.

[sitetest]

Thanks for your reply!

I can understand it for a closely held company. But a large multinational public company held by millions of investors?

It sounds like a way for activists to act in between annual meetings, striking quickly with feel-good proposals without the expense of calling a special meeting.