3M Company | Fair Treament of Shareholder Nominees at 3M Company

Status
Filed
Previous AGM date
Resolution details
Company ticker
MMM
Lead filer
ESG theme
  • Governance
ESG sub-theme
  • Shareholder rights
Type of vote
Shareholder proposal
Filer type
Shareholder
Company sector
Industrials
Company HQ country
United States
Resolved clause
RESOLVED: Shareholders request the Board of Directors of 3M Company adopt and disclose a policy stating how it will exercise its discretion to treat shareholders’ nominees for board membership
equitably and avoid encumbering such nominations with unnecessary administrative or evidentiary requirements.
Supporting statement
SUPPORTING STATEMENT: In the view of the proponent, the Board should consider exercising its discretion under the proposed policy toward ensuring that paperwork requirements governing the nomination and election of directors should generally treat shareholder and Board nominees equitably; requirements regarding endorsements and solicitations should not unnecessarily encumber the nomination process.
Consideration should also be given under the policy to repealing any advance notice bylaw provisions imposing additional requirements inconsistent with this proposal, unless legally required, such as those requiring:
• Nominating shareholders be shareholders of record, rather than beneficial owners;
• Nominees submit questionnaires regarding background and qualifications (other than as required in the Company’s certificate of incorporation or bylaws);
• Nominees submit to interviews with the Board or any committee thereof;
• Shareholders or nominees provide information that is already required to be publicly disclosed under applicable law or regulation; and
• Excessive or inappropriate levels of disclosure regarding nominees’ eligibility to serve on the Board, the nominees’ background, or experience.
The legitimacy of Board power to oversee the executives of our Company rests on the power of shareholders to elect directors:1
[T]he unadorned right to cast a ballot in a contest for [corporate] office . . . is meaningless without the right to participate in selecting the contestants... To allow for voting while maintaining a closed candidate selection process thus renders the former an empty exercise.”2
Burdening shareholder nominees can entrench incumbent directors and management. Laws and regulations overseen and enforced by the U.S. Securities and Exchange Commission, a neutral third party, ensure shareholders have pertinent information on nominating shareholders and nominees before executing proxies.3
Advance notice bylaws can create hurdles for shareholders exercising their rights and can be used to conduct “fishing expeditions” to which board nominees are not subject. These practices delegitimize corporate activity because directors work on behalf of shareholders, who should be able to replace their own fiduciaries. Company interference in this process is especially dangerous because
financial theory recommends that most shareholders diversify their portfolios.Such diversified investors have an interest in ensuring our Company does not profit from practices that threaten social and environmental systems upon which diversified portfolios depend.4 Company directors influenced by executives, in contrast, may prioritize Company profitability over systems that are of critical importance to shareholders.5
Accordingly, giving Company directors a gatekeeper role through a burdensome unequal nomination process threatens the interests of shareholders to nominate candidates free of management influence

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Any voting recommendations set forth in the descriptions of the resolutions and management proposals included in this database are made by the sponsors of those resolutions and proposals, and do not represent the views of the PRI.

Information on the shareholder resolutions, management proposals and votes in this database have been obtained from sources that are believed to be reliable, but the PRI does not represent that it is accurate, complete, or up-to-date, including information relating to resolutions and management proposals, other signatories’ vote pre-declarations (including voting rationales), or the current status of a resolution or proposal. You should consult companies’ proxy statements for complete information on all matters to be voted on at a meeting.