The lone Democrat on the Securities and Exchange Commission is expected to depart later in 2019 according to various press reports. Democrat Commissioner Robert Jackson, a fierce critic of share buybacks and a former TARP official, will have served just under two years if he leaves the Commission. Mr. Jackson was appointed in early 2018 to a term that expires this June, but under SEC rules, he could remain at the SEC until the end of 2020 if a successor is not nominated. Instead, he is expected to rejoin the faculty at New York University Law School. Mr. Jackson was a professor at NYU prior to joining the SEC. Previous to that, Mr. Jackson was a professor at Columbia Law School.
Mr. Jackson’s departure could have several noted impacts at the SEC. First, although President Trump recently nominated Allison Lee for the open Democrat slot for Commissioner, without her confirmation, Mr. Jackson’s departure would mean the SEC would consist of two Republican Commissioners and Chair Jay Clayton, who is technically an independent. Although Mr. Jackson’cannot impact the Commission's three-member voting quorum, nor can he block rulemaking or enforcement actions which he opposes, his presence, writings and influence may shape or slow rulemaking and other initiatives. For example, Mr. Jackson’s intense focus on share buybacks has raised the profile of the issue at the SEC and he recently coauthored an op-ed urging the Commission to require reporting of GAAP metrics alongside non-GAAP metrics in the compensation disclosures in proxy statements. Without Jackson – or another Democrat – the Chair Clayton's agenda would face less internal resistance, even as oversight from the House of Representatives intensifies.