Anne Sheehan, director of corporate governance for the $206.5 billion California State Teachers' Retirement System, West Sacramento, was elected chairwoman of the Securities and Exchange Commission's Investor Advisory Committee on Thursday during its meeting.
Ms. Sheehan was appointed to the committee when it was created in 2012 and has served as acting chairwoman since April. Committee members serve three-year terms. Ms. Sheehan, who also chairs a subcommittee representing investors as owners, said the committee's work with the SEC is important to safeguard the integrity of robust capital markets.
Committee members, who represent a range of views among market participants, also discussed challenges to capital formation, the declining number of initial public offerings and the Financial CHOICE Act passed by the House on June 8. Senate action has not been scheduled.
The CHOICE act seeks to replace much of the Dodd-Frank Wall Street Reform and Consumer Protection Act and make substantial changes at the SEC, including the in-house court system. These include more cost-benefit analysis requirements, increased penalties for civil and administrative violations, and creation of an enforcement ombudsman and enforcement advisory committee.
Institutional investors opposes its tighter restrictions on submitting shareholder corporate proposals and voting for corporate board directors. Provisions that would substantially raise the ownership threshold for submitting proposals "is a turning of a shareholder right into a privilege for a billionaire's club," said advisory committee member Anne Simpson, investment director, sustainability, at the $323.9 billion California Public Employees' Retirement System, Sacramento, during the meeting.
Columbia Law School professor John C. Coffee Jr., director of the school's Center on Corporate Governance, told the committee that the CHOICE Act "in some ways will totally deregulate by eliminating area after area."