Senator Charles Schumer (D-NY) has introduced sweeping legislation that, if enacted, would significantly change how corporate boards are elected and operated. The bill, the “Shareholder Bill of Rights Act of 2009,” addresses virtually all of the major reforms sought by activist investors during the past decade, including proxy access, advisory votes on compensation, and independent board chairs.
Writing on the RiskMetrics Group blog yesterday, Ted Allen noted that while the Business Roundtable and other corporate advocates were mobilizing against the bill, investor advocates were praising its provisions. The Council of Institutional Investors, the California Public Employees’ Retirement System, and the American Federation of State, County, and Municipal Employees quickly endorsed the bill.
“We believe that stronger investor oversight is critically needed to restore trust and confidence in the integrity of the U.S. capital markets,” said Joe Dear, CalPERS’ chief investment officer, in a letter to Schumer. “Your legislation will enhance our ability to be active and prudent shareowners.”