if ONLY the WITHOLD vote made a difference. Directors don't have to step down.
Even when the owners (shareholders) say they should.
What a world we live in. He who has the Gold...
Key Findings
Most directors who receive majority withhold votes continue to serve. Only 5% of the majority withhold votes in our study led directly to director removal.
Majority or plurality plus resignation election standards increase the probability, but do not guarantee, that “unelected directors” will step down. Only 8% of the directors who received majority withhold votes at companies with plurality plus resignation standards stepped down shortly after the annual meeting, and only half of directors at companies with majority standards did so.
Majority withhold votes are not just about “best practices.” Only about half of majority withhold votes in the study period were attributable to generic violations of perceived best practice such as failed attendance, directors serving on too many boards (“overboarding”), related party transactions, or poison pill adoption without shareholder approval. The remaining votes appear to have been driven mostly by shareholder concern with issues specific to the companies in question.
Majority withhold votes are often part of a larger pattern of shareholder concern.Nearly one-fifth (18%) of majority withhold votes occurred at companies where there was evidence of shareholder dissatisfaction not only with the director in question but with the board or company as a whole (as discerned through patterns of high withhold votes for multiple directors, votes against management on proxy ballot items, and proxy contests).