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The SEC’s long-awaited final rules governing voting advice provided by proxy advisory firms such as Institutional Shareholders Service (ISS) and Glass Lewis (the “final rules”) became effective on November 2, 2020. The final rules confirm that proxy advice constitutes a solicitation under the federal proxy rules, and provide proxy advisory firms with a conditioned exemption from the filing and information requirements that would normally apply to such solicitations. To secure the exemption, proxy advisory firms must (i) provide disclosure of conflicts of interest and (ii) adopt policies and procedures to inform public companies of the firm’s proxy voting advice and notify the firm’s clients of the availability of public company responses to this advice. The final rules provide two safe harbors to satisfy these conditions as well as additional guidance on the applicability of the proxy rules’ anti-fraud provisio
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The SEC s long-awaited final rules governing voting advice provided by
proxy advisory firms such as Institutional Shareholders Service
(ISS) and Glass Lewis (the final rules ) became
effective on November 2, 2020. The final rules confirm that proxy
advice constitutes a solicitation under the federal proxy rules,
and provide proxy advisory firms with a conditioned exemption from
the filing and information requirements that would normally apply
to such solicitations. To secure the exemption, proxy advisory
firms must (i) provide disclosure of conflicts of interest and (ii)
adopt policies and procedures to inform public companies of the
How Companies Can Prepare for SEC Proxy Advisor Reform Tuesday, January 12, 2021
The SEC’s long-awaited final rules governing voting advice provided by proxy advisory firms such as Institutional Shareholders Service (ISS) and Glass Lewis (the “final rules”) became effective on November 2, 2020. The final rules confirm that proxy advice constitutes a solicitation under the federal proxy rules, and provide proxy advisory firms with a conditioned exemption from the filing and information requirements that would normally apply to such solicitations. To secure the exemption, proxy advisory firms must (i) provide disclosure of conflicts of interest and (ii) adopt policies and procedures to inform public companies of the firm’s proxy voting advice and notify the firm’s clients of public company responses to this advice. The final rules provide two safe harbors to satisfy these conditions as well as additional guidance on the applicability of the proxy rules’ anti-f