By Cydney Posner

This morning, Corporate Counsel brings to our attention an article in Smart Money about a move by a couple of boards of directors (Sara Lee Corp. and Coach Inc.) to amend their companies' bylaws to require that anyone who submits a shareholder proposal or director nomination also provide information about his or her short positions or other hedging activities in the shares. The idea is to determine and disclose whether the proponent might have short-term interests in the proposal or nominee that may not be consistent with those of the other shareholders. The article suggests that this extra step may "deter hedge funds or activist investors from manipulating a company's stock price for their own gain." Although it remains to be seen whether this practice will be widely followed, companies concerned about the potential for manipulation may want to consider adopting amendments of this type.

Here are links to the 8-Ks disclosing the amendments:

Link 1

Link 2

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