In a situation where decisions are made by vote, the typical threshold to get anything done is 50%-plus-one. So...you need half of everyone’s vote plus one more to get a proposal passed.
However, that’s not always the case. Sometimes you need a super majority. The term refers to a different, higher threshold for getting a particular measure enacted.
An example in government comes from the vote needed to overcome a presidential veto. In that case, 2/3 of the House and Senate need to vote for something in order to overcome a veto. Not a majority...a super majority of 2/3.
In corporate terms, a company's bylaws will spell out the voting rules and procedures. Certain decisions may require super majority votes by shareholders.
Related or Semi-related Video
Finance: What is a proxy?8 Views
Finance a la Shmoop. What is a proxy? Well it's kind of an approx-i-mate. As in, it's
not exactly the way dogs mate. Not all of them try to text their goodies to each
other. In the land of Finance, a proxy is simply a substitute.
Someone's vote, for example, can be given to another party, who then acts on behalf
of the person, who was going to vote in the first place. But really couldn't care [coffee drive-thru]
less about the outcome, so she went to Dunkin Donuts instead. That's how
most votes are taken in public companies. Proxies are sent out to shareholders, who
then designate their wishes, to then be submitted to an individual, physically
present at the vote, who then you know votes and that's it.
We'll leave you with final warning. Beware of any incoming texts you may get
from a German Shepherd. [Phone with dog text]
Up Next
What is non-voting stock? Non voting stock is a class of stock that carries no voting rights on agenda items subject to shareholder vote. While som...
What is Cumulative Voting? When public companies have ballots for shareholders to vote for board members, shareholders have a total number of share...