The New Proxy Rules Impact on Director Qualifications and Diversity of the Board

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The enhanced proxy rules recently adopted by the SEC require added disclosure in the proxy materials for the 2010 annual meeting regarding the background and qualifications of directors and nominees and the diversity of the board.

Added disclosure regarding director/nominee qualifications is now required in an effort to provide investors with more meaningful information about directors and nominees so investors can make better informed voting decisions. For each director/nominee, the experience, qualifications, attributes or skills that led the company to select the director or nominee for the board should be described in the proxy materials. The rules do not provide the specific information that should be considered leaving it to each company to identify what skills would best benefit that particular company. Factors that may be considered include relative industry experience, leadership experience, risk management experience, and other relevant professional experience. In addition, "soft skills," such as whether a director is insightful or probing, may also be a consideration.

This Jaeckle Alert, prepared by the attorneys at Jaeckle Fleischmann & Mugel, LLP, is intended for general information purposes only and should not be considered legal advice or an opinion on specific facts. For more information on these issues, contact one of the attorneys listed above or your existing Firm contact. Prior results do not guarantee a similar outcome. The invitation to contact is not a solicitation for legal work in any jurisdiction in which the contacted attorney is not admitted to practice. Any attorney/client relationship must be confirmed in writing.