Boardroom Governance with Evan Epstein

James McRitchie: The Gadfly Seeking Corporate Change Via Shareholder Proposals

Episode Summary

In this episode, I talk with James McRitchie, a shareholder advocate and one of the three most active individuals filing shareholder proposals at U.S. public companies. He follows a long tradition of gadflies such as the Gilbert brothers, Wilma Soss, Evelyn Davis, John Chevedden, the Steiners and a few others. Last year Jim and his wife filed 50 shareholder proposals, averaging more than 50% support. In his words, his proposals seek to make corporations more democratic and accountable. Jim is the publisher of since 1995, the first corporate governance blog on the internet. We talk about his motivations and thoughts around boardroom governance and the future of the public corporation. If you like this show, please consider subscribing, leaving a review or sharing this podcast with colleagues or friends. You can also subscribe to the Boardroom Governance Newsletter at

Episode Notes

  1. Start of interview [1:30]
  2. Jim's "origin story" [2:12]
  3. How his experience at CalEPA led him to become a shareholder advocate [6:07]
  4. His experience with Mark Latham, a former Berkeley Prof and Salomon Brothers banker on developing and promoting a new shareholder proposal method  [8:03]
  5. His efforts to get elected to the CalPERS board [11:33]
  6. CalPERS and the increasing influence of institutional investors in corporate governance  [12:53]
  7. "Thirty years ago no shareholder proposal had ever passed." Last year [McRitchie] filed 50 proposals and in 26 of them he got majority vote or else he worked an agreement with the company. [14:21]
  8. His Proxy Access petition to the SEC in 2002 [15:28]
  9. Why his friends from social responsible investment (SRI) funds started filing shareholder proposals [16:57]
  10. Pax World Funds was the first socially responsible investment fund. "Later on, SRI funds started engagement campaigns." [18:55]
  11. "ISS and Glass Lewis don't set the agenda, it's the public opinion that sets the agenda." "ISS is not driving the vote, they simply hold up a mirror to its customers" [20:28]
  12. Jim's take on "stakeholder capitalism" and BRT's restatement of the purpose of the corporation. [21:56]
  13. Jim's shareholder proposals at BlackRock: His "hypocrisy proposal." [23:46]
  14. Jim's approach for his shareholder proposals, and why he's getting majority support. How he compares with John Chevedden and the Steiners. He keeps a spreadsheet with 150 target companies. [25:27]
  15. Why he does what he does: "I am really pissed off with all these injustices" [27:20]
  16. The influence of the book "A Nation of Small Shareholders" by Janice Traflet (2013) [28:47]
  17. The problem of dual class shares [31:15]
  18. Jim is taking a page from Elizabeth Warren. He'd like companies to elect a director who can serve  as a liaison to employees ("Rooney rule but including employees"). [32:33]
  19. Jim's Rulemaking Petition to the SEC for Real-Time Disclosure of Proxy Votes [34:19]
  20. Why he files around 50 shareholder proposals per year [36:14]
  21. The impact of COVID-19 on his work, and the advent of virtual shareholder meetings [37:14]
  22. "There has been tremendous corporate governance progress on paper (not so much in reality)" [38:22]
  23. How his work has enabled hedge funds to go after companies [39:18]
  24. His favorite books: [44:42]
    1. The Social Construction of Reality (1966) (Peter Berger & Thomas Luckmann)
    2. Participation and Democratic Theory (1970) (Carole Pateman)
    3. Power and Accountability (1992) (Bob Monks and Nell Minow)
  25. His favorite study: NSF meta-study from 45 years ago: workplace should be more democratic, employees should have more say. [44:42]
  26. The living person he most admires: [48:05] Nell Minow.
  27. The people that have most influenced his work: [49:06]
    1. Bob Monks
    2. Nell Minow
    3. Rich Koppes
    4. The Gilbert brothers.

Music/Soundtrack (found via Free Music Archive): Seeing The Future by Dexter Britain is licensed under a Attribution-Noncommercial-Share Alike 3.0 United States License