ASA Submits Letter on SEC’s Shareholder Proposal Rule

WASHINGTON, D.C. – Yesterday, the American Securities Association (ASA) sent a letter with several other organizations to the U.S. Securities and Exchange Commission (SEC) regarding their proposed amendments to Exchange Act Rule 14a-8, which generally requires public companies to include shareholder proposals with their proxy materials unless they meet certain exceptions.

“The SEC’s shareholder proposal fundamentally changes the ‘no-action’ process used for shareholder proposals, which currently balances the costs to corporations and the returns to long-term investors of each proposal,” ASA CEO Chris Iacovella said. “Abandoning the 2020 proxy reforms before they take effect threatens to further politicize our capital markets, and American investors deserve better.”

In 2020, the SEC adopted amendments to its proxy rules that established accountability to proxy advisory firms and improved the shareholder proposal process under Rule 14a-8. ASA supported the SEC’s rules to modernize the proxy process in a way that improves the governance of public companies.

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