Staggered elections

Short description: Elections where only a part of the body is elected at a time

Not to be confused with Rolling election.

Template:Elections

Staggered elections are elections where only some of the places in an elected body are up for election at the same time. For example, United States senators have a six-year term, but they are not all elected at the same time. Rather, elections are held every two years for one-third of Senate seats.

Staggered elections have the effect of limiting control of a representative body by the body being represented, but can also minimize the impact of cumulative voting.[1] Many companies use staggered elections as a tool to prevent takeover attempts. Some legislative bodies (most commonly upper houses) use staggered elections, as do some public bodies, such as the United States Securities and Exchange Commission.

## Contents

* 1 Application in business
* 2 Use in legislative bodies
* 2.1 National
* 2.2 State
* 2.2.1 Argentina
* 2.2.2 Australia
* 2.2.3 India
* 2.2.4 United States
* 2.3 Local
* 3 Historical usage
* 3.1 National
* 3.2 Local
* 4 See also
* 5 Notes

## Application in business

A staggered board of directors or classified board is a prominent practice in US corporate law governing the board of directors of a company, corporation, or other organization, in which only a fraction (often one third) of the members of the board of directors is elected each time instead of en masse (where all directors have one-year terms). Each group of directors falls within a specified "class"—e.g., Class I, Class II, etc.—hence the use of the term "classified" board.[2] The work of the Shareholder Rights Project has had a significant effect on the number of classified boards on the S&P 500.[3]: 159

In publicly held companies, staggered boards have the effect of making hostile takeover attempts more difficult; however, they are also associated with lower firm value.[4]: 10 When a board is staggered, hostile bidders must win more than one proxy fight at successive shareholder meetings in order to exercise control of the target firm. Particularly in combination with a poison pill, a staggered board that cannot be dismantled or evaded is one of the most potent takeover defenses available to U.S. companies.[5]

In corporate cumulative voting systems, staggering has two basic effects: it makes it more difficult for a minority group to get directors elected, as the fewer directorships up for election requires a larger percent of the equity to win; and it makes takeover attempts less likely to succeed as it is harder to vote in a majority of new directors.[6] Staggering may also however serve a more beneficial purpose, that is provide "institutional memory" — continuity in the board of directors — which may be significant for corporations with long-range projects and plans.[6]

Institutional shareholders are increasingly calling for an end to staggered boards of directors—also called "declassifying" the boards. The Wall Street Journal reported in January 2007 that 2006 marked a key switch in the trend toward declassification or annual votes on all directors: more than half (55%) of the S&P 500 companies have declassified boards, compared with 47% in 2005.[7]

## Use in legislative bodies

### National

Chamber  | Type  | Classes  | % of seats up per election  | Length of term (years)  | Method of staggering

|
|
|
|
|

Total  | 1  | 2  | 3
Argentine Chamber of Deputies  | Lower house  | 2  |

130 / 257

127 / 257

|  | 4  | Every constituency has seats in both classes, with roughly half of the seats contested in each class individually
Argentine Senate  | Upper house  | 3  |

24 / 72

24 / 72

24 / 72

| 6  | Each constituency has all its seats in one class only
Australian Senate  | Upper house  | 2  |

40 / 76

40 / 76

|  | 6[a] | The six states ordinarily elect half of their 12 senators at each election, while the 4 senators representing the territories are elected at each election
Brazilian Senate  | Upper house  | 2  |

54 / 81

27 / 81

|  | 8  | Every constituency has seats in both classes, with two-thirds of the seats contested in class 1 and the remaining one-third in class 2
Senate of Chile  | Upper house  | 2  |

23 / 43

20 / 43

|  | 8  | Each constituency has all its seats in one class only
Senate of the Czech Republic  | Upper house  | 3  |

27 / 81

27 / 81

27 / 81

| 6  | Each constituency has all its seats in one class only
Senate (France)  | Upper house  | 2  |

174 / 348

174 / 348

|  | 6  | Each constituency has all its seats in one class only
Rajya Sabha (India)  | Upper house  | 3  |

77 / 245

78 / 245

78 / 245

| 6  |
House of Councillors (Japan)  | Upper house  | 2  |

124 / 248

124 / 248

|  | 6  | Every constituency has seats in both classes, with half of the seats contested in each class individually
Senate of Liberia  | Upper house  | 2  |

15 / 30

15 / 30

|  | 9  | Every constituency has seats in both classes, with half of the seats contested in each class individually
National Assembly (Nepal)  | Upper house  | 3  |

19 / 59

20 / 59

20 / 59

| 6  | Every constituency has seats in all three classes, with roughly a third of the seats contested in each class individually
Senate of Pakistan  | Upper house  | 2  |

52 / 104

52 / 104

|  | 6  | Every constituency has seats in both classes, with half of the seats contested in each class individually
Senate of the Philippines  | Upper house  | 2  |

12 / 24

12 / 24

|  | 6  | The Senate is elected nationwide at-large, with half of the seats contested in each class individually
United States Senate  | Upper house  | 3  |

33 / 100

33 / 100

34 / 100

| 6  | Every constituency has seats in two out of the three classes, with half of the seats contested in each of those classes individually

*     ^ 6 years for state senators, 3 years for territory senators.
* In the Australian Senate, a double dissolution election can happen, where all seats are contested. The 4 Territory seats are contested at each election.
* Some chambers do not have all of its seats elected, such as in the Rajya Sabha where 12 seats are appointed by the president.
* By-elections (special elections) can be held concurrently with general elections, increasing the number of seats up in an election.

### State

#### Argentina

12 of the 24 provincial legislatures have staggered elections:

* Buenos Aires: Chamber of Deputies and Senate
* Buenos Aires City: Unicameral legislature
* Catamarca: Chamber of Deputies and Senate
* Chaco: Unicameral legislature
* Corrientes: Chamber of Deputies and Senate
* Formosa: Unicameral legislature
* Jujuy: Unicameral legislature
* La Rioja: Unicameral legislature
* Mendoza: Chamber of Deputies and Senate
* Misiones: Unicameral legislature
* Salta: Chamber of Deputies and Senate
* San Luis: Chamber of Deputies and Senate

#### Australia

In the federal Senate, half of the Senate's 76 members are eligible for re-election every 3 years. All members elected from states have a six-year term staggered over two election cycles; senators elected from the ACT and the NT have 3 year terms only. These half-Senate elections are usually held in conjunction with an election of all members for the Federal House of Representatives. There are rare instances in which a Federal election is held for the all members of the House of Representatives and all the members of the Senate at once, this is called a double dissolution election.

Three of Australia's five State Legislative Councils use staggered elections:

* New South Wales Legislative Council
* South Australian Legislative Council
* Tasmanian Legislative Council

Local councils in Western Australia also have staggered elections.[8]

#### India

All six Legislative councils of states have staggered elections:

* Andhra Pradesh Legislative Council
* Bihar Legislative Council
* Karnataka Legislative Council
* Maharashtra Legislative Council
* Telangana Legislative Council
* Uttar Pradesh Legislative Council

#### United States

27 of the State Senates in the United States have staggered elections:[9]

* Alaska State Senate
* Arkansas State Senate
* California State Senate
* Colorado State Senate
* Delaware State Senate
* Florida State Senate
* Hawaii State Senate
* Illinois State Senate
* Indiana State Senate
* Iowa Senate
* Kentucky State Senate
* Missouri State Senate
* Montana State Senate
* Nebraska Legislature
* Nevada State Senate
* North Dakota State Senate
* Ohio State Senate
* Oklahoma State Senate
* Oregon State Senate
* Pennsylvania State Senate
* Tennessee State Senate
* Texas State Senate
* Utah State Senate
* Washington State Senate
* West Virginia State Senate
* Wisconsin State Senate
* Wyoming State Senate

### Local

* Some local councils in the United Kingdom, although the Electoral Commission in England has recommended that councils standardise on a 4-yearly whole council election cycle.[10]

## Historical usage

### National

* General Council of Andorra (1867–1979)[11]
* Chamber of Representatives and Senate of Belgium (1835–1919)[12]
* Senate and Chamber of Deputies of Bolivia (1944–1964)
* Legislative Assembly of Costa Rica (1913–1948)
* Senate and Chamber of Representatives of Cuba (1902–1950)
* Landsting of Denmark (1915–1953)[13]
* National Assembly of Ecuador (1945–1970, 1984–1998)
* National Congress of Honduras (until 1942)
* Chamber of Deputies of Luxembourg (1922–1951)
* House of Representatives (1849–1888)[14] and Senate (1848–1983)[15] of the Netherlands
* National Congress of Nicaragua (1912–1932)
* First Chamber of Sweden (1867–1970)

### Local

* Andorra: communal councils (1867–1979)[11]
* Argentina:
* Legislature of Córdoba (until 2001)
* Chamber of Deputies of Santa Cruz (until 1998)
* Chamber of Deputies of Santiago del Estero (until 2002)
* Legislature of Tucumán (until 1989)
* Belgium: municipal councils and provincial councils (1836–1914)
* Spain: municipal councils and provincial deputations (until 1923)
* Japan: prefectural assemblies (1878–1890s)[16]

## See also

* Industrial organization
* Mergers and acquisitions
* Takeover, including hostile takeover
* United Kingdom company law
* United States corporate law

## Notes

1. ↑ "Archived copy". http://www.stroock.com/SiteFiles/Pub341.pdf.
2. ↑ See Faleye,O., 2007, Classified Boards, Firm value, and Managerial Entrenchment, Journal of Financial Economics83, 501-529.
3. ↑ Bebchuk, Lucian A.; Hirst, Scott; Rhee, June (2014-02-01) (in en). Towards the Declassification of S&P 500 Boards. Rochester, NY. https://papers.ssrn.com/abstract=2400652.
4. ↑ Hirst, Scott; Bebchuk, Lucian (2010-01-01). "Private Ordering and the Proxy Access Debate". The Harvard John M. Olin Discussion Paper Series 653. https://scholarship.law.bu.edu/faculty_scholarship/338.
5. ↑ See Lucian Bebchuk, John C. Coates IV, and Guhan Subramanian, The Powerful Antitakeover Force of Staggered Boards: Theory, Evidence, and Policy, 54 Stan. L. Rev. 887 (2002).
6. ↑ 6.0 6.1 Hillier, David; Ross, Stephen; Westerfield, Randolph; Jaffe, Jeffrey; Jordan, Bradford (2013). Corporate Finance (2nd European ed.). Berkshire: McGraw-Hill Education. pp. 34–35. ISBN 9780077139148.
7. ↑ Jared A. Favole, "Big Firms Increasingly Declassify Boards", The Wall Street Journal, Jan. 10, 2007.
8. ↑ "Local Government Elections", Western Australian Electoral Commission.
9. ↑ "Length of terms of state senators", Ballotpedia, Accessed 24 August 2016.
10. ↑ Electoral Commission https://democracy.peterborough.gov.uk/documents/s47107/13a. Appendix A Electoral Commission The cycle of local government elections in England.pdf
11. ↑ 11.0 11.1 Consell General - L'abstenció al Principat d'Andorra
12. ↑ "Direction des élections - Evolution de la législation électorale". http://www.elections.fgov.be/index.php?id=2101.
13. ↑ Danmarks Statistik - Rigsdagsvalgene og folkeafstemningerne i april og maj 1953, p. 182
14. ↑ "Negentiende-eeuws districtenstelsel in Nederland" (in nl). https://www.parlement.com/id/vglrdyd9plkn/negentiende_eeuws_districtenstelsel_in.
15. ↑ "Geschiedenis kiesstelsel Eerste Kamer" (in nl). https://www.parlement.com/id/vhnnmt7mlkw5/geschiedenis_kiesstelsel_eerste_kamer.
16. ↑ Akio Kamiko (2010, bilingual): 近代地方行政の黎明期(1868-1880年), pp. 7–8: 府県会規則 /The Start of Modern Local Government (1868 – 1880), pp. 10–11: Prefectural Assembly Law (Fukenkai Kisoku)

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Electoral systems

Part of the politics and election series

Single-winner voting system|

* Approval voting
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Proportional representation|

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Semi-proportional representation|

* Parallel voting
* Single non-transferable vote
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* Alternative vote plus

Usage|

* Table of voting systems by country

Voting system criteria|

* Comparison
* Condorcet criterion
* Condorcet loser criterion
* Consistency criterion
* Independence of clones
* Independence of irrelevant alternatives
* Independence of Smith-dominated alternatives
* Later-no-harm criterion
* Majority criterion
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* Monotonicity criterion
* Mutual majority criterion
* Pareto efficiency
* Participation criterion
* Plurality criterion
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* Smith criterion

Voting system quotas|

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Other|

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Corporate finance and investment banking

Capital structure|

* Convertible debt
* Exchangeable debt
* Mezzanine debt
* Pari passu
* Preferred equity
* Second lien debt
* Senior debt
* Senior secured debt
* Shareholder loan
* Stock
* Subordinated debt
* Warrant

Transactions
(terms/conditions)|

| Equity offerings|

* At-the-market offering
* Book building
* Bookrunner
* Bought deal
* Bought out deal
* Corporate spin-off
* Equity carve-out
* Follow-on offering
* Greenshoe
* Reverse
* Initial public offering
* Private placement
* Public offering
* Rights issue
* Seasoned equity offering
* Secondary market offering
* Underwriting

|

Mergers and
acquisitions|

* Buy side
* Control premium
* Demerger
* Divestment
* Drag-along right
* Management due diligence
* Managerial entrenchment
* Minority discount
* Pitch book
* Pre-emption right
* Proxy fight
* Post-merger integration
* Sell side
* Shareholder rights plan
* Special-purpose entity
* Special situation
* Squeeze-out
* Staggered board of directors
* Stock swap
* Super-majority amendment
* Tag-along right
* Takeover
* Reverse
* Tender offer

Leverage|

* Debt restructuring
* Debtor-in-possession financing
* Financial sponsor
* Leveraged buyout
* Leveraged recapitalization
* High-yield debt
* Private equity
* Project finance

Valuation|

* Accretion/dilution analysis
* Adjusted present value
* Associate company
* Business valuation
* Conglomerate discount
* Cost of capital
* Weighted average
* Discounted cash flow
* Economic value added
* Enterprise value
* Fairness opinion
* Financial modeling
* Free cash flow
* Free cash flow to equity
* Market value added
* Minority interest
* Modigliani–Miller theorem
* Net present value
* Pure play
* Real options
* Residual income
* Stock valuation
* Sum-of-the-parts analysis
* Tax shield
* Terminal value
* Valuation using multiples

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