On Governance: What Does the Near Future Hold for Proxy Advisors?

The Conference Board’s list of predictions about the outcome of the SEC’s proxy roundtable hearing looks more like a wish list than anything grounded in probability, with the exception of the comments by the Conference Board’s own Doug Chia:

Governance Center Executive Director, Doug Chia observed coming out of the SEC roundtable, “What seemed to leave the biggest impression with the SEC was the consistent explanation by the investors and investment advisers of how they use proxy advisory firms—for efficient review of ballot items, data aggregation, research, and vote execution.” Chia believes, “The SEC is likely to see where the proposed legislation in the House and Senate will go before taking any significant action.” In the meantime, Chia says the proxy advisory firms, “may do more to ensure data accuracy and be more transparent, but they are unlikely to change the way they make voting recommendations or share their reports with corporate issuers.” Regarding the continuing role of proxy advisory firms in the marketplace Chia thinks, “Cost pressures are too great for all but the largest investors to decrease their reliance on the services of proxy advisory firms.” 


Source: On Governance: What Does the Near Future Hold for Proxy Advisors?

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