SEC's New Guidance Targets Proxy Voting Responsibilities

Possibly signaling the future direction of regulation of proxy advisers, the U.S. Securities and Exchange Commission (SEC) on Aug. 21 issued two sets of interpretive guidance, one regarding proxy advisory firms under the proxy solicitation rules, and one regarding investment advisers and their proxy voting responsibilities. Among other things, the SEC issued an interpretation that proxy voting advice provided by proxy advisory firms generally constitutes a "solicitation" under the federal proxy rules. The SEC did not seek public comment or propose or adopt any new rules—though it pointed to processes that are already underway pursuant to which comment may be provided and noted consideration of specific potential future rulemaking under which public comment would be a part of the normal part of the rulemaking process. The moves may be an indication of what the SEC staff and the commission are considering with regard to requirements on proxy advisers to improve