Blass Provides Update on Small Fund Outreach Efforts
In a recent speech the director of the SEC’s Investment Management Division discussed outreach efforts began last year to better understand regulatory compliance costs and barriers small and mid-size fund sponsors encounter. Dalia Blass said her staff has already met with 40 small funds and investment advisers. The staff observed that smaller firms faced challenges in devoting internal personnel or hiring outside counsel to comment on Commission proposals and determining how to comply with new requirements. Firms also felt squeezed by costs and challenges associated with the proxy process, including shareholder meetings, meeting quorum requirements, and expenses of soliciting shareholders. Blass said the staff has already begun to address these issues. For instance, the division is taking a fresh look at how it drafts the small entity compliance guides that accompany the SEC’s adoption of new rules to make them more practical, Blass said. With respect to proxy voting challenges, Blass said the division will be focusing on ways to encourage voter engagement and promote shareholder protections while reducing burdens on small firms. Blass also said that the division is looking at how the modernization of certain rules, such as the advertising, cash solicitation and custody rules, could benefit smaller firms. She encouraged feedback and interaction with smaller funds and advisers to aid the outreach effort.