Abstract
Governed by the U.S. Securities and Exchange Commission's Rule 14a-8, shareholder proposals are a fundamental and longstanding mechanism that investors use to express their opinions and preferences on how a corporation is operating. Over the last decade, there has been a marked shift in the subject matter of the proposals that shareholders are submitting, as concerns relating to the environment have become an increasingly key issue. However, shareholder support for these climate-related proposals reached its highest point in 2021 and has declined slightly in subsequent years. The conditions that made shareholder proposals a successful tool in 2021 have since changed, due in part to new guidance from the U.S. Securities and Exchange Commission ("SEC") on the application of Rule 14a-8 and fluctuating support from the most influential asset managers. In response to the limited success climate-related shareholder proposals have experienced, this Note explores the viability of an alternative approach to shareholder proposals: privately negotiated withdrawals. This mechanism operates by having a shareholder withdraw his proposal after reaching a privately negotiated agreement with the board to implement climate commitments. This Note ultimately argues that this currently underutilized tool of privately negotiated withdrawals will enable shareholders to convince boards to reduce their company's total carbon emissions by 2050.
Citation
Gabriella M. Chioffi,
Privately Negotiated Withdrawals: How Shareholders
Can Shape a Company's Carbon Emissions Reduction,
36 Duke Environmental Law & Policy Forum
207-232
(2026)
Available at: https://scholarship.law.duke.edu/delpf/vol36/iss2/2