Jenner & Block

Client Alert: NYSE Rule 452 Corporate Governance Proxy Proposals

On January 25, 2012, NYSE Regulation, the independent regulatory subsidiary of NYSE Euronext, released an Information Memo announcing a change to the application of New York Stock Exchange LLC (“NYSE”) and NYSE Amex Equities LLC (“NYSE Amex Equities”, and together with the NYSE, the “Exchange”) Rule 452 (relating to when member organizations may vote customer shares without specific client instructions) to certain types of corporate governance proxy proposals. In particular, the Information Memo noted that, while in the past the Exchange has ruled certain corporate governance proposals as “Broker May Vote” matters for uninstructed customer shares when the proposal in question is supported by company management, in light of recent trends disfavoring broker voting of uninstructed shares, the Exchange has determined that it will no longer continue its previous approach under Rule 452 of allowing member organizations to vote on such proposals without specific client instructions.