FOR IMMEDIATE RELEASE: August 26, 2009
Leading Investor Law Firms Call On SEC to Ensure Shareholder Rights
Leading Securities and Corporate Governance Law Firms Advocate for Proposed Rules Allowing Shareholders to Nominate and Elect Directors to Company Boards of Directors
NEW YORK, NY (August 26, 2009) – Nine leading securities and corporate governance law firms have signed on to a letter to the Securities and Exchange Commission (SEC) in support of its recent proposal entitled “Facilitating Shareholder Director Nominations.” Under this new rule, a company would be required to include its shareholders’ nominees for director in its proxy materials.
The letter was submitted by the law firms of Barroway Topaz, Kessler, Meltzer & Check, LLP, Berman DeValerio, Bernstein Litowitz Berger & Grossman LLP, Cohen Milstein, Grant & Eisenhofer P.A., Kaplan Fox, Labaton Sucharow LLP, Milberg LLP, and Pomerantz Haudek Grossman & Gross LLP each of which routinely represent domestic and foreign institutional investors. The letter was prompted by comments submitted in response to the SEC’s proposal on behalf of a group of Manhattan law firms that represent various corporate interests challenging the mandatory nature of the SEC’s proposed rule.
“These critics of proxy access are less concerned with promoting sound corporate governance and than they are with insulating incumbent directors from true accountability,” said Edward Labaton, Senior Partner of Labaton Sucharow. “It is the lack of accountability under the current rules that has promoted the very abuses in risk management and excessive executive compensation that we are paying for today.”
The letter urges the SEC to strengthen the rights of shareholders by providing the opportunity to place director candidates on the company’s proxy ballot card and to establish reasonable and appropriate disclosure requirements for corporate nominees. The firms emphasize that ensuring this will encourage director accountability and facilitate the ability of shareholders to exercise their rights under state law as the owners of corporations.
”It is truly the height of hypocrisy for those opposed to proxy access to argue that the proposed rule is somehow improper because it is ‘inflexible,’” commented Jay Eisenhofer, co-founder and managing director of Grant & Eisenhofer. He went on to say that, “The truth is that these critics are the same people who, not even two years ago, successfully opposed a rule that would have permitted shareholders to introduce proxy access proposals tailored to individual corporations. They’re not interested in sound governance, or ‘flexibility.’ They’re interested in maintaining the status quo and protecting the interests of entrenched directors.”
Please see below for a copy of the Firms’ letter.
Proxy Access Letter to SEC