SEC Tried to Push Proxy Access through Back Door

The Securities and Exchange Commission, led by Chairman Mary Schapiro, is committed to providing shareholders with a more direct way to nominate directors of publicly held companies. In fact, according to Business Week, the agency tried to force “proxy access” upon Bank of America when negotiating the recent $150 settlement over the bank’s acquisition of Merrill Lynch. Although proxy access was ultimately excluded from the proposed settlement, Schapiro had hoped to use it as a test case to prove that the rationale was sound. Currently, shareholders who wish to challenge a company’s board nominees must distribute their own ballots. This process, according to Schapiro, major investors, and pension funds, is cost-prohibitive.