The SEC voted unanimously to issue a concept release seeking public comment on the U.S. proxy system, which governs the way in which investors vote their shares in a public company regardless of whether they attend shareholder meetings.
“The proxy is often the principal means for shareholders and public companies to communicate with one another, and for shareholders to weigh in on issues of importance to the corporation,” said SEC Chairman Mary L. Schapiro. “To result in effective governance, the transmission of this communication between investors and public companies must be timely, accurate, unbiased, and fair.”
The SEC said it has been nearly 30 years since the Commission last conducted a comprehensive review of the proxy voting infrastructure – and with significant changes since then in shareholder demographics, technology, and other areas, it said its review of the U.S. proxy system will examine “emerging issues that either did not exist or were not considered significant three decades ago”.
The SEC’s concept release focuses on the accuracy and transparency of the voting process, the manner in which shareholders and corporations communicate, and the relationship between voting power and economic interest.
There will be a 90-day public comment period for the concept release after it is published in the Federal Register.
More information is available at http://www.sec.gov/news/press/2010/2010-122.htm
The concept release is online at http://www.sec.gov/rules/concept/2010/34-62495.pdf