NAM Fights Efforts to Weaken Oversight of Proxy Advisory Firms
Washington, D.C. – The National Association of Manufacturers filed a motion to intervene in the lawsuit brought by Institutional Shareholder Services against the Securities and Exchange Commission on a recent rule that increases transparency and accountability for so-called “proxy advisory firms.” The NAM is seeking intervenor status to defend the SEC’s rulemaking and to protect publicly traded manufacturers from proxy firms’ conflicts of interest and outsized impact on corporate governance.
“The NAM strongly supported the SEC’s recent rule increasing oversight of proxy advisory firms—a targeted, well-reasoned regulatory solution to a problem that has impacted manufacturers and investors for years,” said NAM Senior Vice President and General Counsel Linda Kelly. “The SEC’s deliberate approach to this issue has resulted in vital reforms that will provide manufacturers and their shareholders with more information about these unregulated actors, and the NAM plans to vigorously defend the rule in court.”
Background: The NAM has long advocated increased oversight of proxy advisory firms—little-known, unregulated entities that exert enormous influence over publicly traded manufacturers. These firms have significant conflicts of interest and issue error-filled, one-size-fits-all proxy voting recommendations that can impact the direction of a business and the value of an investor’s shares. The NAM filed comment with the SEC supporting its proposed rule to provide for increased transparency and accountability, and NAM President and CEO Jay Timmons called the final rule, issued in July, a “long-sought, major win for the industry and millions of manufacturing workers.”
The National Association of Manufacturers is the largest manufacturing association in the United States, representing small and large manufacturers in every industrial sector and in all 50 states. Manufacturing employs more than 12.2 million men and women, contributes $2.05 trillion to the U.S. economy annually, has the largest economic multiplier of any major sector and accounts for 62% of private-sector research and development. The NAM is the powerful voice of the manufacturing community and the leading advocate for a policy agenda that helps manufacturers compete in the global economy and create jobs across the United States. For more information about the NAM or to follow us on Twitter and Facebook, please visit nam.org.