This week, Chairman Michael Crapo (R-ID) detailed the 116th Congress agenda for the Republican-controlled Senate Banking Committee. Chairman Crapo mentioned that proxy advisory firms were the subject of one of two hearings on capital formation and corporate governance in the 115th Congress. Further, he noted that the Committee would continue to work to “improve corporate governance” perhaps reinforcing the Committee's focus on issues such as proxy voting and advisory firms.
Voting lines will remain unchanged in the Committee with Republicans maintaining a 14-13 majority in the committee. The slim vote margin will continue to mean primarily bipartisan bills will move in the Committee. Such legislation is more likely to succeed on the Senate floor, with the docket being carefully managed by Majority Leader Mitch McConnell (R-KY).
There is still optimism for some action on proxy advisory firms in the Committee. In addition to Chairman Crapo's specific mentioning of them in his agenda announcement, Senator Jack Reed, the Committee’s second highest ranking Democrat and the chief sponsor of the 2018 Senate legislation on proxy advisory firms remains an influential member of the Committee. Additionally, newly minted Senator Kyrsten Sinema (D-AZ) supported proxy advisory firm reform as a member of the House of Representatives and is both thoughtful and informed on the issue.
The Center is continuing to forward a strong advocacy push on proxy advisory firms to educate policymakers and the SEC on the problems with the industry status quo and the value of the Center’s proposed solutions.