Activist Fund Seeks Ban On 'Nuisance Shareholders'

[Joanne98]

WASHINGTON -(Dow Jones)- A tiny free-enterprise fund wants Exxon Mobil Corp. (XOM) and Charles Schwab & Co. (SCH) shareholders to consider banning advisory proposals favored by activist stockholders it views as a nuisance.

Advisory or "precatory" proposals aren't binding on companies, but they are a popular vehicle for shareholders to express their views on issues from climate change to executive compensation.

The Free Enterprise Action Fund (FEAOX), based in Bethesda, Md., is seeking to close off that option and has filed proposals with Exxon Mobil and Schwab targeting what it calls "nuisance shareholders."

Specifically, the fund wants shareholders at both companies to vote this year on amending the companies' bylaws to preclude shareholders from offering non-binding proposals in the future.

"Shareholder proposals have simply become a way to harass companies," said Steven Milloy, co-head of the $11.5 million Free Enterprise Action Fund.

Labor unions, environmental groups and socially conscious investors supply the vast majority of non-binding shareholder proposals, and "we don't consider them real shareholders," Milloy said in a telephone interview Friday.

http://www.smartmoney.com/news/ON/index.cfm?story=ON-20080222-000820-1604&hpadref=1

[LiberalFighter]

1. Why doesn't the Free Enterprise Action Fund

leave the US and go to China and file proposals there?

[Joanne98]

2. Great idea!

[tanyev]

3. Gosh, that's not very laissez-faire.

Sounds quite regulatory, in fact.

[ixion]

4. activist stockholders?

:wtf:

In other words, these companies are saying: "give us your money and shut the hell up."

[Art_from_Ark]

5. Someone should tell Mr. Milloy

that if someone owns shares in a company, that makes them a shareholder.