FOR IMMEDIATE RELEASE
Wednesday, August 21, 2019
Washington, D.C. – Dennis M. Kelleher, President and Chief Executive Officer of Better Markets, issued the following statement with respect to the Securities and Exchange Commission’s (SEC) votes today on shareholder voting and proxy rules applicable to voting advice:
“For years, corporate management and the Chamber of Commerce put a target on the backs of proxy advisory firms, which provide independent advice to shareholders, and urged the Securities and Exchange Commission (SEC) to take aim and limit their activities and impact. Today, the SEC hit the target when it voted to limit the information shareholders obtain from proxy advisory firms and increase the duties, costs and liabilities of investment advisors, without any data-driven countervailing benefits.
“Corporate management would prefer to limit information to shareholders that would enable effective shareholder engagement, meaningful corporate suffrage, and actual accountability for corporate officers and directors, particularly regarding compensation. The SEC is supposed to protect investors’ interests, but today it joined with management and enabled their greater control and influence over the flow of information, increased the risk of silencing alternative viewpoints, and made it more difficult for shareholders to exercise their corporate voting rights.
“Making matters worse, the SEC’s actions today are unlawful. The votes re-write long-established rules and de facto impose new ones. Such actions violate the Administrative Procedures Act because they were undertaken without notice or the opportunity for public comment. Thus, compounding the error of limiting shareholders’ rights, the SEC failed to properly inform the public and denied the public — including shareholders — an opportunity to have meaningful input into its rulemakings.
Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies – including many in finance – to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.com.