SEC To Vote On NYSE-Proposed Broker Voting Rule Wednesday
01 Luglio 2009 - 5:23PM
Dow Jones News
The Securities and Exchange Commission is slated to finally make
a decision Wednesday on a rule proposed several years ago by NYSE
Euronext (NYX) to bar brokers from voting for corporate directors
on behalf of customers in contested or uncontested elections.
NYSE's proposed broker voting rule was first submitted to the
SEC in 2006. Much to the chagrin of some investors, however, it has
languished there until now.
The proposal seeks to keep brokers from voting on behalf of
customers who haven't given voting instructions. Advocates of the
rule say it helps empower shareholders. They also note that when
brokers vote on behalf of customers, they tend to vote with
management.
If approved, the rule would add "election of directors" to the
list of items for which a member wouldn't be able to give a proxy
vote without instructions from the beneficial owners. It would go
into effect Jan. 1.
Prior to the vote on the rule, Commission Luis Aguilar said
Wednesday that he strongly supported the proposed NYSE rule and
called the right to elect directors a "fundamental right."
"The current NYSE rule on broker voting...allows shareholder
inaction to translate into an actual vote," he said. "This is an
odd result on such a critical matter."
-By Sarah N. Lynch, Dow Jones Newswires; 202-862-6634;
sarah.lynch@dowjones.com