April 4, 2019
Netflix has amended its bylaws to enable a stockholder, or group of up to 20 stockholders, owning at least 3% of the company’s common stock continuously for at least three years, to nominate two board directors or 20% of the board.
Netflix’s board consists of 13 directors, including chairman/CEO and co-founder Reed Hastings.
The subscription streaming video pioneer, which initiated the change on March 28, said any nominees would be subject to certain limitations, including that both the stockholders and nominees satisfy requirements specified in the amended bylaws.
Shareholders approved the change – dubbed proxy access – in a vote at the annual meeting in June.
“By enacting proxy access, Netflix is finally giving investors a meaningful voice in board elections and they are no longer an outlier holding out on their long-term shareowners,” New York City Comptroller Scott Stringer told Reuters.
Netflix had rebuffed previous attempts by shareholders – notably the California Public Employees’ Retirement System (CalPERS), which owns about 689,000 shares – to get a seat on its board.
“The board periodically reviews our corporate governance and determined that adopting proxy access is appropriate at this time,” Netflix said in a statement.