SEC’s Corp Fin Division Issues Release on Proxy Voting Advice
The Division of Corporate Finance under the direction of SEC Chairman Gary Gensler is considering whether to recommend that the SEC revisit recent guidance and rule amendments that addressed the application of proxy rules to proxy voting advice businesses. In a statement Chairman Gensler said he wants the staff to consider whether to recommend further regulatory action regarding proxy voting advice, particularly whether to “recommend that the Commission revisit its 2020 codification of the definition of solicitation as encompassing proxy voting advice, the 2019 Interpretation and Guidance regarding that definition, and the conditions on exemptions from the information and filing requirements in the 2020 Rule Amendments, among other matters.” In light of Gensler’s directions, the Division of Corporation Finance said it will not recommend enforcement action to the Commission based on the 2019 Interpretation and Guidance or the 2020 Rule Amendments during the period in which the Commission is considering further regulatory action in this area. An article in Compliance Week discussed the release and reactions to it. Institutional Shareholder Services, which had sued the SEC in 2019 contending that the guidance on proxy voting represented abuse of power, praised the SEC’s announcement, according to Compliance Week.