Access and Its Opponents: The Vital Role of the Nominating Committee

We are the first to note that access upsets the current state of the law.  Delaware allows any shareholders to nominate directors, the proxy rules effectively take that right away.  Many of the letters, therefore, contained pleas to leave things as they were, as if this supported the state law role in the governance process.

At least one commentator, however, noted that any access rule should "[p]reserve the nominating committee's vital role in maintaining the quality and diversity of the board as a whole."  See  O'Melveny letter.   We appreciate that this is a comment calling for the preservation of the committee's authority to preserve board quality.  But the reference to preserving the board's role in maintaining diversity?  Come on.  That's a role that, given the dismal performance to date, ought not to be maintained but changed outright, with access likely to play a role in that process.

For a history of access, go here.