Gino DiCaro

Governor Vetoes Filing Bill Related to Corporate Election Procedures

By Gino DiCaro, VP, Communications

Capitol Update, Sept. 24, 2004 Share this on FacebookTweet thisEmail this to a friend

AB 2752 (Judy Chu D-Monterey Park) would have required domestic and foreign corporations to file a copy of their corporate election procedures with the California Secretary of State. In his veto message, the Governor appropriately pointed out that any corporation’s bylaws and articles of incorporation, including election procedures, are currently available to the public through the Securities and Exchange Commission (SEC). Rather than imposing new filing requirements on California companies, the Governor suggested we work with the SEC to make access to public information even easier than it now is.

An earlier version of the bill sought to give shareholders more access to the proxies to elect directors and required public companies doing business in California to permit shareholder groups holding as little as two percent of a company's voting securities to directly nominate at least 40 percent of the company's directors in each board election. An additional requirement of the previous version mandated that a corporation doing business in California would have to implement any shareholder proposal that passes by a majority vote even when the proposal is clearly advisory.

While the bill was dramatically improved in the end, it still was a duplicative and unnecessary mandate on California businesses.
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