Bank of America will allow some long-term investors to nominate candidates for its board of directors, the latest company to adopt "proxy access" rules pushed by pension funds.
Groups of investors who have owned at least 3% of the bank's stock for three years will now be able to propose candidates for the board, the Charlotte, N.C.-bank said Friday in a regulatory filing. Bank of America said it will include those candidates in the proxies that it sends to investors.
Pension funds have been pushing companies to adopt such rules after the near collapse of the U.S. financial system showed some corporate boards weren't doing a good job of overseeing risks. Bank of America adopted the rules after talks with pension funds in California and New York, according to New York City Comptroller Scott Stringer, who's responsible for more than $160 billion in retirement funds.
"Proxy access has been fought tooth and nail by corporations since the collapse of Enron," Stringer said in an email. "Now we are seeing a sea change as more and more companies adopt meaningful access."
Stringer submitted proxy access proposals to about 75 other companies. Staples and Abercrombie & Fitch are among those that have adopted them.
Without proxy access, board elections are "one-sided affairs," where ballots only list the directors favored by the company, according to the Council of Institutional Investors, a Washington-based advocacy group. Investors can still send out their own ballots, which can be costly.