Why We Withdraw Resolutions
Filing resolutions, which request a change from a company, is an important action in the shareholder advocacy process. However, in some cases, investors – including Mercy Investment Services – may choose to withdraw a resolution that was filed.
To understand a withdrawal, it's important to know why shareholders file resolutions. After engaging a company through dialogues, a resolution may be necessary to get the company's attention and remind leadership of the seriousness of the issues at hand. At times, filing a resolution is the only way to gain access to the people in a company with the power to make changes. Lastly, a resolution can grab the company's attention when the company hasn't met shareholder expectations.
While resolutions garner more attention, ongoing dialogues tend to bring about more organizational change. During dialogues, shareholders may gain access to upper-level management and extend conversations over several months. Withdrawing a resolution doesn't necessarily signify that the company has agreed to all shareholder requests. Instead, it typically means that the company and shareholders are engaged in conversations about moving the company into a better position; the company has agreed to further discussions; or the company has made changes in response to the shareholder request.
Mercy Investment Services continues to consider and adopt the best approach for each engagement - whether dialogues, resolutions or a combination of the two - when working to create systemic change.