Ryan Nebel Quoted by Insightia on Rising Campaign Costs as Companies Revamp Bylaws

Vice Chair of Olshan’s Shareholder Activism practice Ryan Nebel was quoted by Insightia, a Diligent Brand (subscription required), on the rising costs of proxy contests despite the adoption of the universal proxy rules that were generally expected to make it cheaper and easier for activists to launch campaigns for board seats. As of March 17, only nine definitive proxy statements have been filed as part of contested elections in the U.S. since the universal proxy became mandatory compared to thirty during the same period in 2022 before the universal proxy. “There have been quite a few potential clients looking at companies that have been dissuaded from moving forward with the nomination once they understand what goes into it and what the cost would actually look like,” Ryan explained. The cost of launching a campaign has risen, in large part due to companies amending their bylaws to make it more difficult and expensive for dissidents to nominate and run campaigns. “The cost of the nomination notice has skyrocketed over the past several years as companies continue to amend and revamp their nomination bylaws,” Ryan noted. “It seems like every company has questionnaires that are quite frankly ridiculous in terms of some of the information that they're seeking, which can turn into two- or three-hundred-page documents.”