On November 3, 2021, the staff of the Division of Corporation Finance (Staff) of the US Securities and Exchange Commission issued Staff Legal Bulletin No. 14L (SLB 14L). SLB 14L reverses course on Staff positions taken since 2017 with respect to the ordinary business grounds for exclusion of shareholder proposals from company proxy statements and the economic relevance grounds for exclusion. SLB 14L also addresses the use of emails in the shareholder proposal process. 

In addition to providing further detail on SLB 14L’s changes, this Legal Update also discusses practical considerations for companies, including how the policies in SLB 14L will make it more difficult for companies to exclude environmental, social and governance proposals from their proxy statements.