Yesterday, the Delaware Supreme Court accepted the questions certified to it by the SEC relating to the battle between CA and AFSCME over the proponent’s binding bylaw proposal seeking reimbursement for third-party solicitations. The Court sure didn’t lose any time taking the case – and look at the quick briefing and argument schedule they have set (given CA’s mailing date is July 17th, this was necessary): briefs are due on Monday, July 7; oral argument is scheduled for July 9. We will have a guest blogger giving us news live from the hearing.
We have posted the Supreme Court’s order in our “Shareholder Proposal” Practice Area.
SEC Announces “21st Century Disclosure Initiative”
Last week, the SEC revealed a long-standing project – dubbed the “21st Century Disclosure Initiative” – that now will be conducted by a team led by Dr. Bill Lutz. Corp Fin has been quietly working on this project for several years.
It’s a pretty far-ranging project where anything could happen; for example, the notion of forms being required is up-for-grabs (see IR Web Report for more). The idea is to rethink the entire disclosure framework in the wake of new technology and changes in investor needs; a clean slate to envision how the reporting framework would be created if today were ’33 and ’34.
The first part of this study is expected to be completed by the end of this year, with a “blueprint” of a new framework being the ultimate goal. This is pretty interesting stuff. I can’t help but chuckle because a decade ago, the “Aircraft Carrier” was widely panned as trying to take on too much at once…
SEC Chairman Cox Responds to WSJ Criticism
I hadn’t planned on blogging about the scathing criticism of SEC Chairman Cox in this WSJ article – that delves into details of where the Chairman was during the Bear Stearns crisis, etc. – but I can’t help it now that a response of the Chairman to the SEC Staff was the subject of this CFO.com article.
Did the Chairman’s office provide a copy of his internal memo to CFO.com? If so, as someone who served in Congress, I would expect thicker skin if the “internal” memo was indeed leaked by the former Representative from California.
Our July Eminders is Posted!
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– Broc Romanek
On Friday, Corp Fin Director John White said that the Staff was working to put this year’s batch of processed no-action requests related to Rule 14a-8 on the SEC’s website within the next few weeks. This will result in about 400 letters being posted (and I imagine will include all the correspondence related to the request as well as the Staff’s response). Going forward, the Staff is thinking about posting letters closer to “real-time” rather than waiting until the end of the proxy season.
Among other things that John discussed, he touched on:
– executive compensation review for this year, that I blogged about yesterday
– Section 16 and Form 8-K updates, that I blogged about Friday
– “21st Century Disclosure” project, that I will blog about manana
– proposal to modernize oil & gas reserve disclosures that just came out
– how the Staff intends to have all the Phone Interps updated by the end of the year
– how the Staff intends to review e-proxy results from this year and possibly take further action in the Fall
– “use of corporate website” guidance coming soon
– importance of the SEC’s IFRS rulemaking
– SEC’s credit rating proposals that came out recently
John White: Five Tips on Shareholder Proposals
Here is my paraphrasing of the five tips that John relayed from Corp Fin’s Shareholder Proposal Task Force:
1. Send in your no-action requests to exclude shareholder proposals sooner – so they get processed faster by the Staff and don’t get caught up in a crush of them that are received around Christmas time. Once the crush comes, turn-around times become longer.
2. Provide all correspondence from all proponents to the Staff when you submit your no-action requests.
3. Don’t assume that a Rule 14a-8(b) defect from a proponent one year will extend to the next; the proponent might have fixed the problem.
4. When making your arguments, don’t throw in the kitchen sink and argue points that are not likely to win the day. The Staff has to hassle processing all of those trivial arguments.
5. If a proponent withdraws its proposal, inform the Staff right away so they don’t bother processing it.
As always, it’s a good idea to read Staff Legal Bulletin #14 (and its progeny) when dealing with proposals – they really lay out the process and provide useful tips…
My Masterpiece: Conference Performance Art
Perhaps to prove that I have the power to bend a conference audience to my will, I had a little fun with my panel on executive compensation disclosure Saturday at the Society’s Annual Conference. See the first video after clicking the link below.
Here are the last of the videos I uploaded to the FriendFeed room I created (all videos are no longer than a minute):
– My Masterpiece: Conference Performance Art
– AFSCME’s Rick Ferlauto: SEC Certifying to Del. Supreme Ct.
– Lydia Beebe/Carol Strickland: Former Society Chairs
– Former Corp Fin “Masters of the Universe”
– Terry Helz on Membership Benefits
– Corp Fin Director John White: Lots of SEC Developments
– Francis Byrd, Dave Dixon, Ginny Fogg: Having Some Food
– Broc Romanek