Norges Bank, which manages Norway’s $900 bn Government Pension Fund, has thrown its support behind a growing movement in favor of proxy access in the US under the so-called three-and-three guidelines, joining other heavyweight investors such as CalSTRS and proxy advisers such as ISS.
The world’s biggest sovereign wealth fund, which accounts for 1 percent of shares owned worldwide, says it will vote in favor of proxy access proposals in the US this year for shareholders that have owned at least 3 percent of a company’s shares for at least three years. It also says it would support limitations on the number of board seats that could be affected by proxy access as long as at least 20 percent of a board’s seats – or two seats in the case of smaller boards – can be filled by proxy access candidates.
‘We see little evidence to support the concern that shareholders will use proxy access rights to serve special interests or that it will pose a distraction,’ the fund states. ‘In non-US markets, where shareholders have the right to propose alternative candidates in one form or another, the right is rarely used. Instead, the existence of the right is an effective moderating tool on board actions.’
Last month, proxy adviser ISS announced that it would generally support three-and-three proxy access proposals. Glass Lewis, which will review proposals on a case-by-case basis, announced in January that it would consider recommending a vote against board candidates when a company counters a proxy access proposal with one of its own.
Norges Bank’s support for proxy access proposals that follow the three-and-three structure bolsters the position of asset managers such as CalSTRS, BlackRock, Vanguard and TIAA-CREF, which have also voiced support for the principle.
