The November 2018 SEC roundtable discussion on proxy advisory firms, shareholder proposals and proxy plumbing was an important event, which allowed stakeholders to hear views from both sides of the table. On last week’s episode, we heard from Ken Bertsch, Executive Director of the Council for Institutional Investors. This week, Tom Quaadman, Executive Vice President, Center for Capital Markets Competitiveness with the U.S. Chamber of Commerce, shares his views on these SEC roundtable issues:

[The U.S. Chamber] looks at how policies impact the ability of a business to govern itself–and how policies impact the ability of that business to attract capital it needs to get started, to grow or expand. With that, we’ve seen over the last 20 years a steep decline in the number of public companies. That has been arrested somewhat since 2013–that stabilized. But we’re also seeing a number of governance issues rise to the forefront.

— Tom Quaadman, Executive Vice President, Center for Capital Markets Competitiveness with the U.S. Chamber of Commerce

In this episode, Quaadman comments on political pressures facing today’s companies; he also discusses Senator Warren’s proposed Accountable Capitalism Act and cautions today’s voters to understand the economic risks before dismantling the current system.

Regarding the regulation of proxy advisory firms, Quaadman emphasizes that the U.S. Chamber is focusing on the issues that impact the daily lives of today’s corporate secretaries and general counsels.

“…with the scales of economy that exist within the proxy advisory industry, it’s pretty tough to get competition there, which means you need oversight…” explains Quaadman. “It’s very similar to where credit ratings were several years ago. I think the changes that we are looking for are transparency of process–that there’s an ability to correct mistakes, but more importantly, that the information the advisory firms are putting out is directly linked to the fiduciary responsibility of the institutional investors to their investors.”

Quaadman also comments on the proposed limitation to shareholder proposal resubmissions, along with the Chamber’s stance on board diversity.