The Securities and Exchange Commission (the "SEC") recently announced that it is re-opening the comment period for its June 2009 proposal regarding shareholder access to company proxy materials for director nominations (also known as "proxy access").[1] The SEC’s proposed rules, if adopted, would establish a federal proxy access right and permit proxy access shareholder proposals in company proxy materials.[2]
Topic: Corporate Governance
SEC Adopts Final Rules on Enhanced Proxy Statement Disclosures about Risk, Compensation and Other Corporate Governance Matters
At an open meeting held on December 16, 2009, the Securities and Exchange Commission ("SEC") approved a set of proposed rules to enhance the information provided to shareholders in company proxy statements regarding a number of risk oversight, compensation, board leadership and composition and other corporate governance matters. The SEC approved the final rules by a 4-to-1 vote, with Commissioner Kathleen Casey dissenting. The SEC released the text of the final rules on the same date they were adopted, with the 129 page adopting release available here.
RiskMetrics Group Releases Policy Updates for 2010 Proxy Season
On November 19, 2009, RiskMetrics Group (RiskMetrics), a leading proxy advisory firm, released its U.S. and international corporate governance policy updates for the 2010 proxy season. Please see the U.S. Corporate Governance Policy 2010 Updates (2010 Policy Updates) for details. The 2010 Policy Updates apply to annual meetings held on or after February 1, 2010. This client alert reviews the most significant U.S. policy updates and analyzes related matters for companies to consider now.
“You win some, you lose some” — Recent Appeals and Decisions Involving the UK Financial Services Authority
Two high-profile decisions have been published in the last two weeks regarding actions brought by UK Financial Services Authority ("FSA") against members of the financial services industry. Both cases show signs of an increased willingness on the part of those subject to FSA enforcement action to challenge the enforcement wing of the FSA but with variable levels of success.
SEC’s Division of Corporation Finance Issues New Shareholder Proposal Guidance
On October 27, 2009, the Securities and Exchange Commission’s Division of Corporation Finance (the "Division") issued Staff Legal Bulletin No. 14E (the "Bulletin"), which provides guidance relating to the excludability of certain shareholder proposals under the ordinary business exclusion in Rule 14a-8(i)(7) of the Securities Exchange Act of 1934, as amended ("Rule 14a-8(i)(7)"). The Bulletin addresses two topics:
Financial Regulatory Reform: Consumer Financial Protection Agency Moves Forward
The Gibson, Dunn & Crutcher Financial Markets Crisis Group is closely tracking government responses to the turmoil that has catalyzed a dramatic and rapid reshaping of our capital and credit markets. We are providing updates on key regulatory and legislative issues, as well as information on legal and oversight issues that we believe could prove useful as firms and other entities navigate these challenging times. This update focuses on the House Financial Services Committee’s consideration and approval of H.R. 3126, the Consumer Financial Protection Agency Act of 2009.
The SEC’s Powers to Enforce the Production of Documents and Information, in the UK at Least, Hit a Stumbling Block
On 25 August 2009 (albeit the relevant decision has only recently been published), the Securities and Exchange Commission (the SEC) hit a stumbling block in its efforts to extend its jurisdiction to obtain documents and information from outside its territory, from the UK at least. Over recent years, international co-operation between regulators has increased, and has been reported to have increased, and a near assumption has arisen in the UK that, if the SEC asks for assistance from the UK’s financial services regulator, the Financial Services Authority (the FSA), that assistance will be provided by the FSA and complied with by the relevant UK entity, irrespective of the time and cost involved in doing so.
Considerations for Public Company Directors in the Current Environment
The current economic and regulatory landscape poses unprecedented challenges for public companies and their boards of directors. They are facing scrutiny from shareholders, Congress, regulators and the public, and new proposals to address the causes of the financial crisis have been emerging on almost a daily basis for over a year now.
Financial Regulatory Reform: Derivatives Legislation Moves Forward in House
The Gibson, Dunn & Crutcher Financial Markets Crisis Group is closely tracking government responses to the turmoil that has catalyzed a dramatic and rapid reshaping of our capital and credit markets. We are providing updates on key regulatory and legislative issues, as well as information on legal and oversight issues that we believe could prove useful as firms and other entities navigate these challenging times.
Companies Act 2006 Update — Changes to English Company Law Coming into Force on 1 October 2009
The recent upheaval in English company law is almost over. The provisions of the Companies Act 2006 (the "2006 Act") have been coming into force in stages. Not all the changes have set the pulses racing, though highlights have included the abolition of the prohibition of financial assistance for the acquisition of shares in private companies.