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The Prudential example of shareholder communications referenced below had been cited in the following comments presented to Forum participants:

A printable copy of Prudential Financial's 2011 proxy statement, referenced in Mr. Schneider's comments, was made available to Forum participants by Margaret M. ("Peggy") Foran, Vice President, Secretary and Corporate Governance Officer of Prudential, who is a member of the Shareholder Forum's Policy Review Board and also of the Forum's Program Panel for "E-Meetings" communications standards.

Corporate Secretary Week, March 30, 2011 newsletter

Corporate Secretary


Corporate Secretary Week: 2011 annual meetings: what’s working and what’s not

Dear readers,

Filed last week, Prudential’s proxy statement doesn’t disappoint. The life insurance behemoth’s directors and executives took advantage of a proxy’s potential to showcase their good works and included a ‘state of the union’ letter from the board touting the company’s ‘strong performance’ and ‘effective risk management’. The document also features shareholder-friendly charts and graphics, including colored boxes that highlight Prudential’s sustainability, corporate citizenship and shareholder engagement efforts.

A proxy this accessible is arguably expected from Prudential, where renowned governance guru Peggy Foran serves as chief governance officer and corporate secretary. But other companies, including General Electric, are similarly using their proxies to highlight their best practices and strong performances.

In fact, says Bruce Goldfarb, CEO of proxy solicitation firm Okapi, Prudential’s use of its proxy statement as an investor relations tool is evidence of a small but growing trend that’s been inspired – at least in part – by companies’ unwillingness to incur the cost of creating and mailing a glossy annual report.

‘Proxy statements have traditionally been documents that were drafted strictly to comply with the regulations. They weren’t investor relations-oriented sales documents,’ notes Goldfarb. ‘But I have had discussions with companies that are planning on doing something similarly unorthodox. With all the additional disclosure required these days, using the proxy statement to help investors find salient information on which to base investment decisions has become a worthwhile pursuit.’

Not surprisingly, the Prudential proxy has been a hit with corporate governance proponents and shareholder groups. So have some newfangled annual meeting accoutrements, like Twitter accounts. Starbucks set up a special account just for its events, an undertaking that at least one investor advocate has deemed worth considering, especially if your company doesn’t have a Twitter account dedicated specifically to investor relations.

Starbucks drew criticism, however, for committing an act that’s become an easy target for the 2011 proxy season pundits: failing to disclose the results of the proposal votes for as long as 12 hours after the annual meeting’s close. Apple made headlines for making a similar mistake earlier in the season.

Companies aren’t legally required to release voting results immediately after their meetings, but one thing’s for sure: failing to do so can make even the most sincere attempts at transparency and communication appear disingenuous.

Please send me your thoughts.
Janine Sagar
Corporate Secretary
Follow us on Twitter @corpsecmag


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