Investment firms face new shareholder vote disclosure rules

What does this do?

This bill would require large investment firms to file yearly reports showing how they voted on corporate shareholder proposals and how closely they followed recommendations from outside proxy advisory firms. Firms managing at least $100 billion must also document a financial analysis for any vote that goes against an independent board of directors, and must tell customers they are not required to vote on every proposal.

Who does it affect?

The bill applies to institutional investment managers, such as companies that manage stocks on behalf of pension funds or individual retirement accounts. Firms with at least $100 billion in assets under management face additional requirements beyond the general rules.

Why does it matter?

Clients would be able to see whether their investment manager is making independent decisions or largely following outside advice. This creates a public record of voting behavior that did not previously exist.

Where does it stand?