Today [June 1], Chair Gensler announced that he has directed the SEC staff to consider whether to recommend that the Commission revisit its recent regulatory actions taken with respect to proxy voting advice businesses and its longstanding interpretation of proxy
proxy voting
The Index-Fund Dilemma: An Empirical Study of the Lending-Voting Tradeoff
The future of corporate stewardship – and therefore corporate governance – rests in the hands of a few large institutional investors.[1] Questions of whether these funds have the necessary incentives to pursue stewardship have set off an explosion of …
The Role of Institutional Investors in Stakeholder Capitalism
Institutional investors are increasingly playing a major role in the shift toward stakeholder capitalism. They are also facing pressure from their clients and others to focus more on ensuring that their investments promote corporate sustainability. Such expectations are reinforced by …
Biden and the SEC: Some Possible Agendas
This is the gossip season, and almost everyone has heard a rumor about who will be the next chair of the SEC. Although I was interviewed by the Biden transition team (for my views, not as a candidate), my sources …
Separating Owners from Control: The Proposed DOL Proxy Voting Rule and Other Actions on Shareholder Activism
On October 3, The Shareholder Commons and B Lab submitted their comment on a recent new rule (the “Proxy Proposal”) proposed by the Department of Labor (the “DOL.”) The Proxy Proposal would limit independent proxy voting by pension trustees. It …
The Department of Labor Carpet Bombs Investor Protection
The Department of Labor (DOL) has launched a major attack on investor protection and shareholder rights in the last three months. In three successive strikes against long-standing practices of ERISA fiduciaries, the DOL has created disorder and confusion. Its actions …
SEC Chairman Speaks on Amendments to Proxy Solicitation Rules
Good morning. This is an open meeting of the U.S. Securities and Exchange Commission, under the Government in the Sunshine Act. Today we have two items on the agenda, both continuations of our ongoing work to modernize and enhance the
The Competitive Landscape of the Proxy Advice Market
Despite long-standing efforts to understand the proxy advice market, there is no way to identify the firms that supply specific investors with proxy advice, making claims about market shares conjectural at best. Nevertheless, it is widely believed that ISS and …
Nuveen Previews 2020 Proxy Season: Environmental and Social Practices
Companies recognize the importance of environmental and social (E&S) factors and are giving consideration to a broader group of stakeholders to help mitigate risk. However, new regulations bring uncertainty to the future of environmental, social and governance (ESG) proposals.
The …
Peer Effects in Proxy Voting Decisions
Proxy voting decisions are characterized by strong strategic complementary relationships in the sense that the utility to a shareholder from voting in a particular manner increases with the extent that other shareholders vote in the same manner. Such complementarities arise …
The Results Are in: Global Investor-Director Survey on Climate Risk Management
Institutional investors are increasingly focused on “extra-financial performance” as a predictor of long-term success of companies. Topics like climate change, CO2 emissions reduction, respect for the environment, labour rights, and diversity are more and more factored into investment decisions.
Investors, …
Wachtell Lipton Discusses 2020 Voting Policies from ISS and Glass Lewis
Proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis recently announced updates to their U.S. proxy voting policies for the 2020 proxy season. ISS’s new policies will apply to shareholder meetings held on or after February 1, 2020 and …
Commissioner Roisman on Modernizing SEC Rules About Proxy Voting Advice
I. Introduction – An Important Milestone
Thank you, Chairman Clayton.
I have said before that proxy voting is fundamental to our capital markets.[1] Improving proxy voting is a subject that I am passionate about, and one I have cared
The Shareholder’s Dilemma
Theoretical and empirical research on shareholder voting has provided many exciting insights and guidance for debates on policy and regulation. The default assumption, though, is that shareholders have strong incentives to vote for alternatives that they think are best for …
Nuveen Offers 2019 Proxy Season in Review
The 2019 proxy season was marked by an increased willingness among shareholders to hold boards accountable on director elections, say- on-pay, and environmental, social and governance (ESG) shareholder proposals. For example, almost 5 percent of directors received less than 80 …
Chairman Clayton Speaks Before SEC Investor Advisory Committee
Good morning. I understand the Committee will be continuing the discussion about our proxy system in today’s [September 5] telephonic meeting.
Last month the Commission issued guidance regarding how an investment adviser’s fiduciary duty and Rule 206(4)-6 under the Advisers
SEC Chairman and Commissioners Issue Statements on Proxy Adviser Guidance
The U.S. Securities and Exchange Commission’s chairman and each of its commissioners issued a statement at yesterday’s open meeting on guidance about proxy voting and proxy voting advice. Chairman Jay Clayton’s statement is here. In support of the guidance, …
Blockchain Will Not Solve the Proxy Voting Problem
The U.S. proxy voting process is widely viewed as inefficient, opaque, and frequently inaccurate. The conventional wisdom is that voting inaccuracy has arisen largely as a result of decisions made in the 1960s to transition to a system of share …
Can Blockchain Create a Corporate-Governance Revolution at Public Companies?
In a new paper, we analyze the major disconnect between the theory of corporate governance, its legal expression, and the reality of corporate ownership structures, based on an “indirect holding system” (IHS), which has evolved from complex existing technological …
Vanguard Talks New Proxy Voting Guidelines With PJT Camberview
Vanguard recently made three significant announcements, including an update to its proxy voting guidelines, changes to proxy voting responsibilities for its external managers and a commentary on its views and approach to corporate governance and sustainable investing.
- On Friday, April