A new Web site intended to help organize thousands of individual shareholders in opposition to controversial SEC proposals has been launched as part of a joint effort by The Social Investment Forum (SIF) and the Interfaith Center on Corporate Responsibility (ICCR). The groups charge that the SEC proposals to change its Rule 14a8 under the Securities Exchange Act of 1934 would diminish shareholder activism by limiting the right of shareholders to file advisory resolutions.
The new site, www.SaveShareholderRights.org, was set up with the aim of enlisting 500 institutions and financial professionals to sign a joint statement opposing the SEC proposals, as well as to help facilitate the filing of several thousand comments by individual investors before the Commission comment period ends on October 2, 2007. Copies of investors’ comments posted on the site will be forwarded both to the SEC and to the individual investors Congressional representatives.
The institutional/financial professional sign-on statement addresses three specific concerns: an ‘opt-out’ option that would allow companies to drop out of the shareholder resolution process entirely; the unilateral substitution of the electronic petition model or ‘chat room’ for the public 14a-8 shareholder resolution process; and the raising of shareholder resolution resubmission. It also supports the continued right of investors to nominate board members using the proxy process and urges the SEC to set a reasonable level of shares required for the nomination process.
SIF Board Chair Tim Smith (also a senior VP of Walden Asset Management) compared the current effort to the successful campaign mounted a decade ago when more than 300 socially responsible, religious, labor, and other groups joined forced to oppose an earlier SEC staff plan to revise the shareholder resolution process.