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December 14, 2018

SEC Investor Advisory Committee Highlights Inherent Challenges with ESG Reporting

Yesterday, the U.S. Securities and Exchange Commission (SEC) Investor Advisory Committee met to discuss how the Commission should deal with the increasing prevalence of investors using environmental, social and governance (ESG) factors, in addition to traditional financial reporting, in their decision-making. Participants generally agreed that the current company disclosure practices the ESG ratings assigned to companies often fail to provide investors with useful information about the actual risks those companies face, and do not allow for apples to apples comparisons amongst companies.

December 11, 2018

SEC Chairman Commits to Regulating Proxy Advisors Amid Growing Consensus for Reform

Today, U.S. Securities and Exchange Commission (SEC) Chairman Jay Clayton told the Senate Banking Committee that he has directed his staff to put together a proposal for the Commission’s consideration about issues raised at the recent SEC roundtable regarding proxy advisors. Today’s testimony comes on the heels of another Senate Banking Committee hearing, which featured ...

December 10, 2018

How Does the Shareholder Voting Process Work?

Last month’s U.S. Securities and Exchange Commission (SEC) roundtable on the proxy process highlighted key issues encountered by the different participants of the shareholder voting process. To better understand these issues, it is worth taking a step back to review the purpose of shareholder voting and the mechanics of how it currently works. It is critical for retail investors to appreciate how the voting designation process works, considering that most investors delegate voting to the fund managers of their 401(k)s or pension plans.

December 6, 2018

Senate Banking Committee Hearing Highlights Growing Consensus of Need to Reform Proxy System

These statements of support from Senators and witnesses add to the growing array of people across the board calling for additional scrutiny of proxy advisory firms. The Main Street Investors Coalition is optimistic that this growing consensus will add to continued momentum and additional oversight over proxy advisory firms by the SEC.

November 30, 2018

Economics Organization Adds to Growing List of Groups Calling for Proxy Reform

Two weeks after the Securities and Exchange Commission (SEC) hosted a roundtable on the proxy process, the American Action Forum (AAF) joined the growing number of organizations calling out how proxy advisory firms are harming Main Street investors. The group is led by former Director of the Congressional Budget Office Douglas Holtz-Eakin, and focuses on economic ...

November 27, 2018

BlackRock Calls for Transparency at Proxy Advisory Firms Following SEC Roundtable

Shortly after participating in the Securities and Exchange Commission (SEC) roundtable on the proxy process, BlackRock, the world’s largest money manager, called for the SEC to promote “a principle of transparency throughout the proxy ecosystem.” According to BlackRock, this principle of transparency extends to proxy advisory firms. Proxy Firm Methodologies and Conflicts of Interest Specifically, ...

November 20, 2018

In Conjunction with Roundtable, Vice President of Policy and General Counsel for ACCF Submits Comment To SEC

In advance of last week’s Securities and Exchange Commission (SEC) roundtable on the proxy process, Timothy M. Doyle, Vice President of Policy and General Counsel for the American Council for Capital Formation (ACCF) submitted two comment letters to the Commission. The letters refer to some of the main topics that were addressed at the roundtable, ...

November 16, 2018

SEC Roundtable Signals Continued Momentum for Reform of Proxy Advisory Firms

“I cannot defend the indefensible. There are conflicts of interest that arise from consulting when you are also in the proxy advisory business.” – Sean Egan, Egan-Jones Proxy Services “If shareholder process is just another form of political speech then we need to look at this much more closely and in a much different way.” ...

November 15, 2018

Highlight Reel: Today’s SEC Roundtable

Today’s roundtable on the proxy process, hosted by the Securities and Exchange Commission (SEC), presented a rare opportunity for market participants to debate the proxy process in front of those who regulate the proxy industry. During the three panels, a variety of issues within the proxy process were discussed, with panelists offering up their suggestions ...