Home › Explainers › Why a proposal can win most of the votes cast and still fail
A proposal passes only if it meets the voting standard set for it. That standard is not always a majority of the votes cast. Some proposals need a majority of all shares entitled to vote. Then every share not voted FOR works against the proposal: votes against, abstentions, and shares that were never voted.
Air Products held its annual meeting on January 23, 2025. Proposal 4, submitted by the investor Mantle Ridge, asked shareholders to repeal any bylaw change the board had made without shareholder approval after September 17, 2023.
The company’s Form 8-K reported this vote:
FOR was 62.5% of the votes cast for or against. Yet the 8-K says the company’s shareholders “did not approve” the proposal.
The proxy statement set the standard before the meeting. The bylaw proposal “will be approved by an affirmative vote of a majority of our shares entitled to vote at the Annual Meeting.” It added: “Abstentions and broker nonvotes will have the same effect as a vote ‘AGAINST’ this proposal.”
On the record date, November 27, 2024, 222,383,500 shares were entitled to vote. The proposal needed more than half of them: more than 111,191,750 FOR votes. It received 109,478,204, which the 8-K gives as 49.23% of the votes entitled to vote. It fell about 1.7 million votes short.
Shares that stayed away counted too. The 8-K says 79.44% of the shares entitled to vote were represented at the meeting. The other fifth had the same effect as votes against.
The same tally can pass under one standard and fail under another.
The proxy statement says, item by item, what vote each proposal needs and how abstentions and broker non-votes count. It is usually in the section that answers questions about voting.
The 8-K may not say. Item 5.07 of Form 8-K requires the votes for, against or withheld, the abstentions and the broker non-votes on each matter. It does not require the company to state the standard or whether the item passed. Many companies say anyway; some do not.
The support figure on a company page is FOR ÷ (FOR + AGAINST), captioned “of votes cast”. It is arithmetic, not the result. For Air Products Proposal 4 it reads 63%.
An outcome is shown as Approved or Not approved only where the 8-K says so. Where the filing says an item was not approved although FOR was more than half of the votes cast, the page shows the filing’s word beside the tally. See Approved and Not approved in the methodology, and the Air Products 2024–2025 page.