Exclusive: Berkshire Hathaway gives activists the right to turn it on May 1

(Reuters) – Berkshire Hathaway Inc turned around on Friday and told an activist group that they could submit a shareholder proposal for the May 1 annual general meeting remotely, in line with the new guidance from the US security regulator.

Traditionally, Warren Buffett’s insurance and investment firm has attracted thousands to its lavish annual meeting in Omaha, but, like many top U.S. companies during the coronavirus pandemic, has asked investors to report remotely to the meeting instead of attending in person. .

The move to online has hampered many activist investor groups whose shareholder decisions often animate the meetings. Some have been muted via technology or said they can only present decisions in person, despite the health risks.

This was the case in Berkshire for As You Sow of Berkeley, California, which submitted a measure in which the company’s subsidiaries had to report on diversity and inclusion efforts, and was told to send a representative to Los Angeles where some directors and staff would gather for the live webcast.

Asked about the situation on Friday, CFO Marc Hamburg told Reuters in an email:

‘We would prefer As You Sow to present their proposal at the Los Angeles shareholders’ meeting venue. However, we will offer As You Sow the opportunity to deliver a recording that can be played during the meeting as a way to present their proposal to shareholders. “

While sowing welcome the decision. President Danielle Fugere told Reuters that the organization “is not prepared to risk the health of other people. Therefore, we are relieved that the business has changed course.”

When Berkshire Hathaway contacted the group, it cited new instructions from the U.S. Securities and Exchange Commission, as you said.

As You Sow was among a group of activists and investors, the SEC asked on April 5 to extend last year’s guidance in order to ban the virtual submission of proposals, which a number of businesses appear to be banning this year, in time for the to allow spring shareholder of 2021. event season.

“From the point of view of pandemic security, it is not yet time to require proponents to appear in person,” the letter said.

In a statement posted on its website on Friday, the SEC said that in light of COVID’s concerns, companies are encouraged to offer a proponent of shareholders or their representatives during 2021 to present their proposals on an alternative way to present, as by telephone. season.

The agency also said proponents who could not travel to meetings would have good reason to refine their proposals later.

Hamburg did not respond to questions about how it will handle other shareholder groups.