Washington, DC – Rep. Andy Barr (KY-06), Rep. French Hill (AR-02), Rep. Bill Huizenga (MI-02) and Rep. Barry Loudermilk (GA-11) today sent a letter to U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler urging the SEC to rescind recent staff guidance on shareholder proposals submitted to publicly traded companies. 

Following the SEC’s decision to rescind Staff Legal Bulletins (SLB) Nos. 14I, 14J, and 14K, and replace them with SLB 14L, the members expressed their concern that the new SLB falls outside of the Commission’s statutory authority, writing, “This is yet another example of the Commission pushing a progressive agenda on the shareholder process…  The unelected staff of the SEC should not be the arbiters of social policy in our financial markets.  The SEC has neither the statutory authority nor the expertise to make determinations about the issues of broad societal impact.”

Reps. Barr, Hill, Huizenga and Loudermilk continued, “Another major flaw in this SLB is that it provides no objective process for how SEC staff will evaluate if a proposal is or is not socially significant…  This opaque process will give staff enormous power to force companies to engage on social issues that have nothing to do with their business.”

The members concluded, “We call on the SEC’s Division of Corporation Finance to immediately rescind SLB 14L and reinstate SLB Nos. 14I, 14J, and 14K.  It is inappropriate for the SEC to use staff guidance to go around the statutory rulemaking process under the Administrative Procedures Act while making major changes to the shareholder proposal process.”

To read the full letter, click here.