General Electric is the latest in a small list of companies to adopt “proxy access,” so institutional investors can nominate one of their own for a seat on the company’s board.

779px-GeneralElectricSignIn an 8-K filing to the Securities and Exchange Commission Wednesday, GE said that its board had amended the Fairfield, Conn., company’s bylaws. The amendment permits a shareowner, or a group of up to 20 shareowners, owning 3% or more of GE’s outstanding common stock  to nominate and include in the company’s proxy materials directors constituting up to 20% of the board. The shareowners have to have held their stock continuously for at least three years.

A Wall Street Journal story says that proxy access is rare, citing Hewlett-Packard and Verizon as a couple of the other large companies that have adopted the measure.

“In talking with many of our shareowners and as part of our annual governance review, we decided that implementing proxy access was appropriate at this time,” GE spokesman Seth Martin told WSJ.

The company’s “stagnant” stock price, stuck below $30, is the cause of institutional investor consternation, which has led to some advocating for proxy access, the WSJ writes.

Kevin Mahar, a GE shareholder affiliated with a GE union, last year submitted such a proposal for the company’s 2015 proxy. Shareholders that currently own 3% of outstanding GE shares are large institutional investors, including Vanguard Group, State Street Global Advisors, and BlackRock.

The SEC tried several years ago to impose proxy access on U.S. companies, but a federal court shot down the effort, according to the WSJ.

Featured image: Bubba73, CC BY-SA 3.0

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