CII Responds to President’s Quarterly Reporting TweetIn response to President Trump’s August 17 tweet announcing that he has asked the SEC to study relaxing the quarterly financial reporting requirements for public companies, CII issued a statement affirming the value of timely, accurate financial information to investors. “Investors and other stakeholders benefit when regulations ensure that important information is promptly and transparently provided to the marketplace,” said Amy Borrus, CII’s deputy director. President Trump suggested shifting from quarterly reporting to reporting every six months, but CII shares the view of the SEC’s Investor Advisory Committee that the current degree, quality, and frequency of disclosure strengthens U.S. capital markets. CII does, however, believe that public companies should focus on building long-term value by moving away from quarterly earnings per share guidance, a position also advocated by the Business Roundtable (BRT).
CII Rebuts Wall Street Journal Editorial on Proxy AdvisorsCII issued a statement detailing factual errors in a Wall Street Journal editorial that asserts that proxy advisory firms have too much influence over shareholder votes. Investor independence is clear in voting statistics, CII points out. Although leading proxy advisor Institutional Shareholder Services Inc. (ISS) recommended voting against say-on-pay proposals at 11.8% of Russell 3000 companies in 2017, just 1.4% of those proposals received less than majority support from shareholders. CII also noted that proxy advisors’ voting recommendations generally align with management’s. ISS endorsed management’s proposals on 89% of the more than 21,000 ballots cast in the first half of 2018 in director elections, auditor ratifications, say-on-pay votes, and on employee and director equity plans at Russell 3000 companies. The Journal editorial attacks proxy advisory firms unfairly for doing the work that institutional investors willingly pay them to do, CII Executive Director Ken Bertsch said in the statement. CII plans to submit a letter to the editor expressing its concerns.
CII Staff Discusses Governance Issues on Capitol HillWith Congress quiet during the August recess, CII staffers are meeting with key Congressional aides to discuss several priority corporate governance issues. CII General Counsel Jeff Mahoney and legal intern Brendan Tyler met recently with aides to eight members of the House Financial Services Committee-the committee with direct jurisdiction over capital market issues and oversight of the SEC. They provided information and shared CII’s perspectives on issues including: potential regulation of proxy advisory firms, shareholder proposals, universal proxies, dual class stock, Rule 10b5-1 trading plans and quarterly earnings guidance and reporting.
Fair Financial RulesSensible, effective rules safeguard investors and strengthen markets.
Dual-Class StockEach share of a public company's common stock should have one vote.
Majority Voting for DirectorsIn uncontested elections, directors should be elected by majority vote.
Universal ProxyIn contests, investors should be free to vote for the nominees they prefer.
News & Highlights
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- August 15 - SEC Sends Subpoena to Tesla in Probe Over Musk Tweets
- August 14 - Match Group and IAC Face Lawsuit Over Tinder’s Valuation
- August 12 - NYSE Is Putting Its Own Interest Ahead of Investors
- August 10 - If Turkey Implodes, Here's Who Else Gets Hurt
- August 9 - Proposed Regulatory Regime for Proxy Advisers Sees Lobbying Lift
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