Historically, corporate bylaws have been the “sleepy hollow” of a corporation’s constitution. They typically specify the offices that comprise the corporation’s leadership team, the corporation’s fiscal year and signing officers for the corporation. Bylaws have tended to be uncontroversial. Today, however, in an era of increased shareholder activism, bylaws have become a venue for corporate governance reform.
In recent years, firms have implemented advance notice provisions (ANPs) in their bylaws. ANPs require shareholders to comply with certain procedures and disclosure requirements if they intend to nominate directors at a shareholders’ meeting. In other words, an ANP places additional burdens on shareholders who seek to implement changes to the composition of the Board. (more…)