The SEC, as expected, today approved requiring mutual fund companies to hire independent chairmen; to ensure that 75% of their boards of directors consist of outsiders who should meet separately every quarter; and to conduct annual self-assessments. The rule, proposed in January, also lets independent mutual fund directors hire outside advisers and experts to carry out their duties, and it requires the funds to retain records concerning advisory contracts.
Although the Investment Company Institute had opposed the SEC proposal on independence on mutual fund chairmen, the Washington trade group pledged to support the rule. "We are committed to ensuring that regulatory requirements and business practices serve the interests of current and future mutual fund investors," said Paul Schott Stevens, president.
