One of the hot topics concerning the Senate Bill which passed the Banking Committee on Monday is the right of shareholders to influence decisions about their board of directors. The LA Times published an Opinion piece explaining that shareholders need a bigger say to prevent companies from taking advantage of them.
Lawmakers trying to avert the next Wall Street bailout are still struggling to reach consensus on how to overhaul the country’s financial regulatory regime. One sticking point has been a proposal to let the Securities and Exchange Commission give shareholders more say over who gets elected to boards of directors. Business groups fiercely oppose it, arguing that it would give labor unions and public pension plans the power to force their agendas on management. But a more likely result is that directors would have to become more responsive to shareholders’ concerns about executive pay and corporate governance.