Earlier this month members of our Corporate Finance & Securities Practice Group attended the Ray Garrett Jr. Corporate and Securities Law Institute’s 2009 Conference held in Chicago at Northwestern University.
Items on the Securities & Exchange Commission (“SEC”) agenda for 2009:
- Say on Pay - The Commission does not have authority over the Troubled Asset Relief Program (“TARP”) “say on pay” requirement, but nevertheless has provided guidance for how financial institutions should handle the issue in their 2009 proxy materials. The Commission is currently considering its own “say on pay” requirements for all issuers. Chairperson Mary Schapiro appears to support a non-binding advisory vote for all public companies.
- E-Proxy - Beginning January 1, 2009, all issuers must comply with the new “e-proxy” rules. Rules provide specific guidelines for the contents of the e-proxy notice that issuers are required to mail shareholders. The Commission is considering revising the rules to allow for the inclusion of this educational material.
- Greater Proxy Access - The Commission is considering greater shareholder access to the issuer’s proxy and director nomination process.
- Director Experience - In June 2009, the Commission will consider whether to enhance disclosure requirements relating to director nominee experience, qualifications and skills. This includes considering whether boards should be required to disclose the reasons behind the particular leadership structure chosen by the company.
- Regulation D - The Commission is reviewing the definition of accredited investors.
- International Financial Reporting Standards - The Commission is considering adopting the international financial reporting standards.
- Short Selling - The Commission is currently seeking public comments on whether short sale price restrictions or circuit breaker restrictions should be imposed and whether such measures would help promote market stability and restore investor confidence.
- Broker Voting – New York Stock Exchange (“NYSE”) filed a proposal with the Commission to amend NYSE Rule 452. As written, Rule 452 currently permits brokers to vote on “routine” proposals if their client has not provided specific voting instructions. The proposal, which is expected to be approved, would eliminate broker discretionary voting for the election of directors.
We expect to see all of these issues addressed over the coming months and will keep you informed.