Adobe Systems board of directors changed the voting standards for their own election last week, according to a filing with the SEC Tuesday. In uncontested elections, a nominee must now receive more “for” votes than “against” votes. In the past it did not matter how many votes were cast against an uncontested nominee.
Exactly why a company would ever have allowed “against” votes in an election, but not count them as binding on the results, we don’t pretend to understand.
But elections to the board room aren’t as simple as that. Should a majority of shareholders vote against an incumbent nominee, they had to hope that the rejected nominee take that into consideration and turn in a letter of resignation to the board.
The company also added a provision requiring that any future director nominees proposed by shareholders also “deliver a statement that, if elected, they agree to tender an irrevocable resignation” if they fail to received the required vote in subsequent elections.