By Cydney Posner

For those who haven't been glued to C-SPAN watching the negotiations of the conference committee on regulatory reform, below is a recap from someone at ISS (yes, post-acquisition, that's its name once again) who apparently was glued. (From the discussions I was able to catch, it was mostly an interminable shouting match about whether Democrats or Republicans were more responsible for the financial debacle.) The recap below, quoted in this morning's Corporate Counsel, seems to indicate that some things actually were accomplished (although note that it's a very hectic and confusing process and certainly subject to change):

  • Mandatory majority voting has been dropped from the bill as Senate conferees have agreed to eliminate it; this was not in House bill
  • Proxy access provision could become more detailed as Senate conferees agreed to impose a 5% ownership standard and a two-year holding period on shareholders who wish to nominate directors (under Base Text, details would have been left up to the SEC); uncertain if House conferees will accept this change
  • Say-on-pay could be altered to allow companies to hold them on a biannual or triennial basis rather than be forced to do so annually; not certain whether this will be accepted by either Senate or House conferees
  • Senate conferees accepted a House provision to permanently exempt small issuers from SOX's auditor attestation requirements - even though the Dodd bill didn't have this provision in it
  • Senate conferees didn't accept House conferees' proposal to mandate votes on "golden parachute" packages
  • Senate conferees accepted House conferees' proposal to require large institutional investment managers to disclose their say-on-pay votes
  • Senate conferees accepted House conferees' proposal to ensure that the SEC's independence standards for compensation consultants are competitively neutral
  • House conferees voted to add a new provision to permit private rights of action for aiding and abetting (overturning Stoneridge and Central Bank) even though there was no similar provision in Base Text (but this provision did exist in an older version of a House bill from last December); not likely that Senate conferees will accept this
  • House conferees accepted SEC self-funding, as well as creation of new SEC offices for whistleblowers and ombudsman; Senate had already approved this in Dodd bill - but now some Senators are trying to strip the SEC's self-funding.

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