SEC staff issues important guidance on shareholder proposals for the 2019 proxy season

On October 23, the SEC’s Division of Corporation Finance issued Staff Legal Bulletin No. 14J (CF) (SLB 14J) to provide new guidance on the application of the “ordinary business” and “economic relevance” exceptions to a public company’s obligation under Exchange Act Rule 14a-8 to include shareholder proposals in its proxy materials. The guidance will govern SEC staff action during the 2019 proxy season on company no-action requests seeking exclusion of shareholder proposals on the basis of these exceptions.