At a roundtable event, SEC Commissioners set the stage for market participants to discuss (i) proxy voting mechanics and technology, (ii) the shareholder proposal process and (iii) the role and regulation of proxy advisory firms. SEC Chair Jay Clayton, Commissioner Kara M. Stein and Commissioner Elad L. Roisman asked investors, issuers and other market participants to provide feedback on several features of the proxy process.

SEC Chair Jay Clayton asked market participants to (i) evaluate whether the SEC could improve the existing system and to (ii) consider who would benefit from improvements to the process. Mr. Clayton stated that he believed "long-term Main Street investors" should be the beneficiaries of any proposals.

SEC Commissioner Kara M. Stein said that the current proxy process should be updated. Ms. Stein explained that several features of the proxy system make an "already opaque system" more complex. She identified issues with respect to the distribution of proxy materials, the processing of votes, and the way in which shares are held. Ms. Stein urged market participants to discuss (i) how technology can improve proxy mechanics, (ii) whether SEC staff guidance on the shareholder proposal process has been effective, and (iii) the role of proxy advisors in the process.

SEC Commissioner Elad L. Roisman emphasized the importance of helping shareholders to be more engaged in the management of companies outside of the annual meetings. He encouraged consideration of the eligibility requirements for shareholder proposal submissions and resubmissions, which have not been reviewed by the SEC since 1998.

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