Shareholder Primacy x Proxy Countdown Crossover:

"2026 Predictions" with Matt Moscardi & Damien Rollis (Proxy Countdown), Mike Levin, and Ann Lipton

Date: December 17, 2025
Podcasts: Shareholder Primacy / Proxy Countdown
Host Organizations: Free Float Media, The Activist Investor, University of Colorado Law
Panel: Mike Levin (A), Ann Lipton (D), Matt Moscardi (C), Damien Rollis (B)

Main Theme

A holiday wrap-up and predictions episode, this memorable crossover brings together top personalities from Shareholder Primacy and Proxy Countdown. The hosts dissect key events and regulatory changes in the 2025 proxy/activist landscape, then debate the unpredictable terrain of the 2026 proxy season: governance, activism, pay, and the intensifying legal-political skirmishes shaping corporate power. Tone is energetic, irreverent, and combative, with technical depth and sarcasm in equal measure.

Key Discussion Points

1. 2025 Recap – Defining Events (02:08–22:35)

• Tesla’s AGM:

  • Elon Musk’s Pay Package: Tesla shareholders voted to restore Musk’s invalidated Delaware pay package and approve a new, potentially trillion-dollar package (04:13). Much discussion on legal limbo between Texas corporate law (new headquarters) and ongoing Delaware lawsuits (04:48).
  • Unique Structure: Musk and brother voted their stakes; new Nevada/Texas-based IPOs discussed. Expectation Musk will seek founder-friendly dual-class structures elsewhere (06:27).
  • Quote [D]: "Tesla is... an ever never ending source of amusement or horror for business law professors. I mean, it's never boring." (04:00)
  • Quote [C]: "He definitely is going to come out like he's going to have $1 trillion in options there." (06:17)

• ExxonMobil’s “Perpetual Proxies”:

  • Trying to lock in long-term retail votes for management—‘like a gym membership’: easy to forget, hard to cancel (08:14).
  • Behavioral economics curiosity, but so far, not copied by other companies (09:02).
  • Quote [D]: "Basically Exxon is going to try to lock in retail votes... likely to stay that way." (08:14)

• Costco’s Shareholder Proposal Exception:

  • Allowed anti-ESG (anti-“woke”) proposal on the ballot, despite SEC ambiguity, unique among large companies (09:33).
  • Quote [C]: "Of course it's Costco being the first one." (10:01)

• Activism Highlights:

  • Elliott Management emerged as the most aggressive major activist; notable for taking contests to a vote (Phillips 66, Toyota Industries), winning 2 out of 4 board seats even as “big three” (Vanguard, BlackRock, State Street) voted against them (12:53, 15:09).
  • Universal proxy cards have empowered activists in board elections (13:33).

• Proxy Advisors in the Political Crosshairs:

  • Facing unprecedented pressure from Congress, state & federal agencies post-2024 (17:55).
  • Under Republican administration, rules may curb their influence/fiduciary status (20:43).

• Delaware Corporate Law Shift:

  • New 2025 statute simplifies life for controlled companies, especially relating to conflicted transactions (Tesla/SolarCity as example) (23:13).
  • The “Dexit” scare (companies threatening to leave Delaware for Nevada/Texas) led to Delaware loosening, mostly seeing micro-cap exits to Nevada, not Texas (26:26).

2. Predictions & Hot Takes for 2026 (29:11–61:36)

A. Director Votes: Will More Directors Be Ousted? (30:11–37:41)

• Hurdles: Historic rate of directors losing (>50% ‘for’ vote) is 0.2%, rarely enforced (“zombie directors”) (31:25), e.g., Jay Hogue at Netflix.
• Regulatory Chilling Effect: New (so-called) “13D/13G Daisy Chain” guidance scares investors from coordinated “no” votes without triggering filings (32:26, 33:24).
• Prediction Split:

  • Mike (A): Predicts small uptick in “no” votes, incited by lack of other ballot items and underperformance, but more zombie directors as boards refuse to enforce ousters (36:48).

  • Ann (D): Expects most pressure to land on controlled companies and boards involved in conflict transactions now harder to sue over under new law.

  • Matt (C): Skeptical; structure and intimidation will keep numbers minimal.

  • Quote [B]: "This era that we're living in... is all about taking control over regulatory agencies to give power to the CEO... We're just giving CEOs more power. That's all it is." (21:58)

B. Shareholder Proposals: Will Anyone Copy Costco? (41:16–44:30)

• SEC’s “no-action” process now optional; most companies eagerly excluding proposals unless submitted by large incumbents (CalPERS) or litigious groups (41:01).
• Only a handful (3–400 vs. 900 in 2025) expected to survive to ballots, mainly from well-resourced proponents (41:15, 44:09).
  • Ann (D): “If the proposal comes from CalPERS, they’ll let it be voted.…if the proposal comes from a small number of shares, they will [exclude].” (40:51)
  • Mike (A): “The number…is like eight or nine hundred [2025]. There’s going to probably be…three or four hundred or fewer.” (40:05)

C. Say-on-Pay (Executive Compensation):

• Some uptick in “no” votes expected, but few actual consequences; companies apologize or use one-time awards, rarely rescind payouts (43:24–44:41, 59:10).
• Extreme packages (like Musk/Tesla) may normalize outsized awards or provoke routine protest votes, but effect is muted since such votes are advisory (57:49–58:23).
  • Quote [C]: “Even when they gave a retention bonus and investors voted against pay, they apologized but didn’t take back the retention bonus... two years later they’re gonna do the same one time thing again.” (59:14)

D. Rise of Activists and Universal Proxy (46:41–49:00)

• Expect a marked increase in activist-led proxy contests leveraging universal proxy card—resources, experience, and legal firepower make activists best-positioned to force board change (47:41).
• Mike (A): “Financial activists…will be more aggressive. Universal proxy made it easier... and people are finally getting used to how to use that.” (47:41)

Speed Round: “Which is More Likely?” (49:52–61:36)

1. Does the new executive order (re: proxy advisors) hold real teeth? (51:46–54:13)

   • Fraud statutes don’t fit; alternative regulatory hooks unclear, major changes would require Congress (52:32).
   • Glass Lewis/ISS registering as investment advisers, shifting clients to custom policies to skirt accusations of providing unsolicited advice (53:44).
   • Ann (D): “Glass Lewis resisted forever, but now it’s announced that it's going to register as an investment advisor anyway.” (53:29)

2. Will Musk's Mega Pay Package Unleash Me-Too Award Mania? (56:45–58:23)

   • Some attempts, but most fail to achieve goals; boards may install loopholes for award payouts regardless of performance (57:08).
   • Non-binding say-on-pay votes will persist, could increase as a pressure valve for shareholder discontent, but little real accountability (58:18).

3. “Dexit” Winner: Delaware, Nevada, Texas, or No One? (60:29–61:18)

   • All agree Texas is unlikely to win; Nevada is favored for micro-caps, but Delaware’s agility preserves its dominant role for IPOs/large-caps.
   • Ann (D): “I’m going to say it’s Delaware. Delaware is agile. The loser here is investors, shareholders.” (61:01)

Notable Quotes & Memorable Moments

• On Proxy Advisors:

  • [D, 18:00] “It’s a whole government approach to attacking proxy advisors at state and federal level.”
  • [C, 19:04] “Take an outcome based approach to what they actually do...management almost always wins.”
  • [A, 22:24] “There's nothing else happening at every single level. The idea is to essentially consolidate a sort of authoritarian view of the corporation.”

• On Activism:

  • [A, 14:23] “If I had to think of a single very large feared activist that has sort of assumed the crown...Elliott’s really up there.”

• On Delaware Law:

  • [D, 24:53] "Made it very easy to engage in various kinds of conflict transactions without being challenged, which is the whole point."
  • [A, 27:05] "...their fear was way overblown because...Delaware gets tens of thousands of new incorporations a year..."

• On Board Votes/Director Accountability:

  • [B, 36:11] “Who will be the initial targets? Like the long, the long tenure directors?”
  • [A, 37:28] "...we are going to have more, even more of the Jay Hogue phenomenon...companies’ boards will rationalize this by saying...this director is really valuable."

• On Say On Pay:

  • [C, 43:03] “We have seen votes no on pay...and 98% vote for every pay committee member, which is like, well, what are you actually saying to the company?”

• On the Proxy System as a Whole:

  • [C, 61:11] "No one, because it's a race to the bottom when it comes to everyone."
  • [A, 61:18] "The loser here...is investors, shareholders."

Timestamps of Key Segments

• 2025 Season Recap start: 02:08
• Tesla AGM/Pay Package: 02:56–07:09
• ExxonMobil Perpetual Proxies: 07:39–10:33
• Costco/Shareholder Proposal Exception: 09:27–10:38
• Elliott Management/Activism: 12:38–15:09
• Delaware Corporate Law changes: 22:42–27:40
• 2026 Proxy Predictions Segment Begins: 29:11
• Director ouster rates/Proxy “group” chilling effect: 31:25–35:05
• Shareholder Proposals Future: 38:02–45:03
• Activist Campaigns Predicted to Increase: 46:41–49:50
• “Which Is More Likely?” Speed Round: 49:52–60:29
• Dexit (Delaware v. Texas/Nevada): 60:29–61:18

Conclusion & Final Thoughts

2025 was a transition year: regulatory pushes, legal dramas, the narrowing of shareholder rights, and political moves put a premium on insider clout and activist sophistication. For 2026, the group predicts:

• Shareholder proposals will collapse unless supported by major players; retail voices will be further marginalized.
• Director accountability remains a mirage without binding consequences; zombie directors to proliferate.
• Say-on-pay votes will get angrier but remain toothless; actual outcomes will shift little.
• Activism will flourish as universal proxy lowers logistical barriers; only the best-resourced will muscle through meaningful corporate change.
• Systemic losers: shareholders and investors; consolidation of power in the hands of management and their enablers (“monarchies everywhere you look”).
• Delaware adapts and survives; Dexit threat overhyped for now.

The hosts close with a nod to their unique dynamic and promise more crossovers:
"Maybe after proxy season we'll get back together...do a little wrap up sometime in the spring." (A, 61:53)

Panel Attribution Key:

• A: Mike Levin (activist investor)
• B: Damien Rollis (Free Float Analytics)
• C: Matt Moscardi (Free Float Analytics)
• D: Ann Lipton (Colorado Law professor, corporate law scholar)

For further info: Mike (theactivistinvestor.com), Ann (law.colorado.edu), Matt & Damien (freefloatanalytics.com)

NOTE: This summary excludes all ads, intro/outro, and non-content banter, focusing solely on substantive discussion and predictions.