Chairman Mary Schapiro Outlines the SEC's Near-Term Agenda

January 1, 0001


On April 6, 2009, SEC Chairman Mary Schapiro gave a speech to the Council of Institutional Investors outlining the immediate agenda of the SEC. According to Chairman Schapiro, the SEC will be considering the following in the next few months:

  • Short Sales -- proposing new rules to limit short sales in a down market, and convening a roundtable of experts to debate any rules limiting short sales (the Commission will consider these new rules on April 8, 2009);
  • Proxy Access -- advancing a proposal to ensure shareholders have meaningful opportunities to nominate directors (the Commission intends to consider this matter in May 2009);
  • Director Nominees -- enhancing disclosure regarding the experience, qualifications and skills of nominees for director (the Commission intends to consider this matter in June 2009);
  • Board Structure -- requiring disclosure of the manner in which boards decided upon their particular leadership structure (e.g., independent chair, non-independent chair, or combined CEO/chair) (the Commission intends to consider this matter in June 2009);
  • Overall Compensation Approach -- requiring disclosure regarding the overall compensation approach of issuers, beyond decisions with respect to the named executive officers only;
  • Compensation Consultants -- requiring disclosure regarding compensation consultant conflicts of interest; and
  • Risk Management -- enhancing disclosure on how boards and issuers manage risk, both generally and in the context of compensation.

Further, the Commission will be creating an Investor Advisory Committee to ensure that the SEC receives input from a wide range of shareholders on a variety of topics.

In addition to the above, Chairman Schapiro stated that the SEC will be considering the following reforms, some of which may require legislation, with respect to financial intermediaries and other market professionals:

  • Third-Party Audits -- requiring annual third-party audits, on an unannounced basis, of those with custody of client assets to ensure the safekeeping of such assets;
  • Harmonization -- harmonizing the responsibilities of investment advisers and broker-dealers to create a uniform level of professionalism and accountability;
  • Compliance Audits -- mandating third-party compliance audits for certain investment advisers to ensure compliance with the law;
  • Hedge Funds -- registering hedge funds and hedge fund advisers;
  • Credit Rating Agencies -- requiring more disclosure from credit rating agencies, including assumptions underlying their methodologies, fees received from issuers, and factors that could change ratings;
  • Credit Default Swap Market -- more vigorous oversight of the credit default swap market, including creating reporting and recordkeeping rules;
  • Money Market Funds -- enhancing the standards applicable to money market funds;
  • Municipal Securities -- providing investors in municipal securities with the disclosure and investor protections provided to investors in other securities; and
  • Asset Backed Securities -- enhancing disclosure around asset-backed securities.