The Shareholder-Director Exchange Investor Letter

The Shareholder-Director Exchange Protocol Infographic

The 10-point SDX Protocol offers guidance to public company boards and shareholders on when shareholder-director engagement is appropriate, and how to make such engagements valuable and effective.

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Press Releases

Building Meaningful Communication and Engagement with Shareholders

Thank you, Jeff, for that kind introduction.

I am honored to be with you here in Chicago at the Society’s 69th National Conference. Over the years, the Society has consistently provided thoughtful comments to the Division of Corporation Finance and the Commission on a wide variety of issues and proposed rules. You understand the complexities that can affect multiple parties and recognize the importance of the interests of shareholders. All of you play a critical role in corporate governance. It is the decisions you make, the practical solutions you advance and the views you share with your boards that can, in large part, dictate the relationship between shareholders and companies.

Because of your central roles in your companies, many of the Commission’s initiatives are of interest to you: our disclosure effectiveness review; the audit committee disclosures concept release the staff is working on; and any number of our rulemakings. My hope is that you will see near-term activity in these and other areas, including rules mandated by the Dodd-Frank Act, such as the clawbacks rule as required by Section 954, the pay ratio rule under Section 953(b) and the joint rulemaking on incentive compensation as required by Section 956. So stay tuned for those developments.

But today my focus is on a selection of proxy-related issues, another area of particular interest to you. And my overall theme complements the theme of your conference, “Connect, Communicate, Collaborate.” Be proactive in building meaningful communication and engagement with your shareholders.

The Shareholder-Director Exchange (SDX) Hosts Inaugural Symposium on Shareholder- Director Engagement to Further Advance Growing Governance Movement

NEW YORK, Nov. 17, 2014 /PRNewswire/ — The Shareholder-Director Exchange (SDX) Working Group and Founders – Cadwalader, Wickersham & Taft LLP; Teneo; and Tapestry Networks – hosted the inaugural SDX Symposium at the Harvard Club in New York City on Friday, November 14, 2014. The event convened a group of leaders across various disciplines to engage in a candid discussion on the importance of shareholder-director engagement in corporate governance. Attendees included a distinguished group of CEOs, directors, and representatives from institutional investors and academic institutions.

Leading Public Company Directors and Representatives of Major Institutional Investors – United Under Shareholder-Director Exchange Banner – Announce New Steps Taken to Advance Growing Governance Movement

NEW YORK, July 22, 2014 /PRNewswire/ — The working group of the Shareholder-Director Exchange (SDX) and its founders – Cadwalader, Wickersham & Taft LLP; Teneo; and Tapestry Networks – today announced important developments related to its initiative to encourage engagement between shareholders and directors, including the transmission of a letter from investor representatives of the SDX working group to Lead Directors and Corporate Secretaries of every Russell 1000 company, as well as the expansion of the SDX working group.

The full letter can be accessed here and is also available at

The letter was written by investor members of the SDX working group, and it asks public company boards to consider adopting and clearly articulating a policy for shareholder-director engagement, whether through adoption of the SDX Protocol or otherwise. The letter states:

“Engagement between public company directors and their company’s shareholders is an idea whose time has come. We believe that U.S. public companies, in consultation with management, should consider formally adopting a policy providing for shareholder-director engagement, whether through adoption or endorsement of the SDX Protocol or otherwise. Several prominent U.S. companies are already following this path of engagement and disclosing their engagement efforts – we believe other public companies should follow their lead.”

Leading Public Company Directors and Institutional Investors Join to Launch SDX™ –  the Shareholder-Director Exchange

NEW YORK, Feb. 3, 2014 /PRNewswire/ — A working group of leading public company directors, institutional investors and the advisory firms Tapestry Networks, Inc., Cadwalader, Wickersham & Taft LLP and Teneo Holdings, LLC together with Broadridge Financial Solutions, Inc., today announced the launch of SDX – the Shareholder-Director Exchange. SDX is the collective best thinking of a broad group of leading corporate governance practitioners on why, how, and when boards and institutional investors should engage directly with each other. Although the SDX Protocol can be used in the context of a corporate crisis, it is intended to be a broader template for discussing and addressing corporate issues in the normal course of business.

“Market conditions as well as an increasing focus on better and more effective governance practices have demonstrated the necessity of direct communication between directors and shareholders,” said Bonnie Hill, Director, AK Steel Holding Corp., California Water Service Group, The Home Depot, and Yum! Brands. “There is a growing call for directors to engage directly with shareholders, but until now, the circumstances and conditions under which that engagement should take place have been unclear. The SDX Protocol was developed in partnership with investors and directors to help navigate these uncharted waters.”