WASHINGTON, DC – FEBRUARY 3, 2020 – Concerned citizens delivered over 18,000 signatures to the Securities & Exchange Commission (SEC) in a major show of opposition to a SEC rule proposal that would bar many investors from pushing corporations for action on major issues, including greenhouse gas reduction goals, lobbying and election spending discussion, human rights abuses and discrimination.
The proposed changes will weaken the ability of investors to raise important concerns and thereby give corporations more unchecked power, including the ability to essentially ignore the views of shareholders and other stakeholders.
Green America, Americans for Financial Reform (AFR) and As You Sow delivered the signatures today to the SEC at its Washington, D.C., offices at 100 F Street NE. Signatures also were gathered by Public Citizen and Interfaith Center on Corporate Responsibility (ICCR).
The Green America petition states: “We, the undersigned, are deeply concerned about the need to build an economy that will be successful over the long term. This means we need to ensure that social, environmental, and corporate governance issues facing corporations are effectively addressed. As we know, significant improvement across these issues is needed if our economy and society are to thrive for generations to come.
“Investors, including small investors, have an important role to play in identifying for corporations a number of risks and corporate impacts of which they may not be aware. These risks and impacts may damage specific companies and the larger economy.
“Since 1934, the shareholder proposal process (Rule 14a-8) has been a positive tool that enables investors to share important information with fellow investors and with corporate management. It is working well and should certainly not be weakened.”
Green America Executive Co-Director Fran Teplitz said: “There is no democracy for shareholders in America unless they have a right to engage in meaningful shareholder advocacy and to be heard. The SEC is contemplating locking many shareholders out of the process. Many of the major advances of recent corporate history – going back to the rejection of racist apartheid South Africa and as recently as action on climate change – owe their success to shareholder advocacy. Today, we are fighting for democracy and against a world that is run even more than it is today by corporations that can ignore the public. We are pleased that over 10,000 Green America members signed our petition to the SEC.”
Along with Green America, several groups also urged the SEC to uphold the current shareholder resolution process:
Marcus Stanley, policy director at AFR, said, “This administration has consistently weakened regulations that foster corporate accountability. Now the SEC is weakening even the mechanisms by which the majority of shareholders can advocate for responsible corporate governance and corporate social responsibility.”
Bartlett Naylor, financial policy advocate, Public Citizen said, “Shareholder activists serve on the front line with whistleblowers, unions and even the police to keep American corporations honest. It’s not quantum physics to figure why big business through its U.S. Chamber front wants to stifle these agents of reform.”
Andrew Behar, CEO of As You Sow, said, “With this vote, the SEC has apparently inverted its mandate of protecting shareholders to that of protecting companies from shareholder input — even where company action creates increasing risk to shareholders, people, or the environment. This proposal flies in the face of the SEC’s mandate of ensuring transparency, open discussion, and company responsiveness to shareholder concerns; it has the potential to increase shareholder and company risk, particularly regarding growing climate concerns. We don’t believe that it will withstand public or legal scrutiny.”
Josh Zinner, CEO of ICCR, said, “The current proxy process offers shareholders of all sizes a straightforward channel to company management, board, and other investors to provide constructive feedback and, when needed, raise concerns about critical ESG risks. This important give and take process has been demonstrably beneficial for the long value of companies and investors and should be safeguarded by the SEC."
Sanford Lewis, director of the Shareholder Rights Group (a group of leading proponents of shareholder proposals), said: “The SEC rule change proposals are fatally flawed. The SEC failed to conduct the needed research prior to issuing the proposals, and therefore they lacked the necessary legal and economic foundation for a rule proposal. The proposals undermine the rights of investors to file proposals, hire representatives, and to aggregate stock with other concerned shareholders.”
ABOUT GREEN AMERICA
Green America is the nation’s leading green economy organization. Founded in 1982, Green America provides the economic strategies, organizing power and practical tools for businesses and individuals to solve today’s social and environmental problems. http://www.GreenAmerica.org
MEDIA CONTACT: Max Karlin for Green America, (703) 276-3255, or firstname.lastname@example.org.