Following the SEC’s announcement that it will not act as a referee on requests to exclude shareholder proposals this proxy season, public companies will have more power over the process, but the development isn’t a sure-fire win for the business community, experts said. The change could lead to more chaos this proxy season, and more proposals making it onto proxy statements if companies fear a legal challenge as a result of their decision. “This will bring about certainly some short-term chaos here as people try to figure out the lay of the land,” said David Lynn, a partner in Goodwin's Capital Markets group and chair of the firm’s public company advisory practice. SEC Chair Paul Atkins, during a Nov. 14 appearance on FOX Business, said the proxy firms have too much power over management decisions. Given Atkins’ prior comments, “I don’t think that anyone should have seen this as sort of coming out of left field,” Goodwin's Lynn said of the Nov. 17 announcement.
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