SEC measure heralds 'shift of power' in US

A new measure giving shareholders the right to nominate directors for large companies is expected to change the US corporate landscape dramatically.

Despite strong opposition from business lobby groups, the Securities and Exchange Commission (SEC) voted to allow investors to make their own nominations for boardroom seats through the proxy access system.

According to the Guardian, the measure represents "a historic shift in the balance of power in the US corporate world", as shareholders have previously enjoyed limited influence over board composition.

Chairman of the SEC Mary Schapiro has acknowledged the change as one of the most controversial issues ever handled by the organisation.

Under the new system, investors will be eligible to register their nominations for directorships on a company's proxy form, provided they have kept a holding of three per cent or more for at least three years.

Speaking last week, Ms Schapiro said she has "great faith in the collective wisdom of shareholders to determine which competing candidates will best fulfil the responsibilities of serving as a director".