August 24, 2016

Shareholder Proposal Proponents: Why Do Individuals Bother to Do It?

This Cooley blog describes this new study by Professors Larcker & Tayan about why individual shareholder proponents bother to submit shareholder proposals to companies. I appreciate the professors mentioning my article about the Gilbert brothers (who are mainly responsible for the initial growth of proposals as a tactic to pressure companies) – and I note that the professors spoke to nine individual proponents to write this new study…

SEC Enforcement: Disclosing “Accelerated Monitoring Fees”

Here’s the intro from this WSJ article:

The Securities and Exchange Commission is investigating whether private-equity firm Silver Lake properly disclosed fees it earned when selling companies or taking them public, part of the regulator’s expansive push to make sure buyout firms are being upfront with investors. The SEC is looking into one-time “accelerated monitoring fees” that Silver Lake collected when it sold companies or took them public, according to people familiar with the matter and Silver Lake investor letters reviewed by The Wall Street Journal.

Buyout firms like Silver Lake collect a range of fees from both portfolio companies and directly from the funds they raise to buy the companies. The SEC has pressured firms to disclose more about these fees to fund investors, typically pensions, endowments and wealthy individuals. The SEC’s Silver Lake investigation is continuing and may not result in any action, but the inquiry is another sign that the agency is taking a broad view of its ability to monitor the $4.2 trillion private-equity industry.

Stats: Number of SEC’s Enforcement Actions Decline

Here’s news from this blog by Kevin LaCroix:

The SEC’s enforcement activity so far this fiscal year trails the record levels in the 2015 fiscal year. According to a recent report from Cornerstone Research, the SEC’s enforcement activity through the end of the fiscal third quarter (on June 30, 2016) is 8% below the activity levels during the same period in FY 2015, largely as a result of an activity decline in the third quarter.

Broc Romanek