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119-hr-8383119th CongressWALLET

Protecting Americans’ Savings Act

Sponsored By: Representative Nunn, Zachary [R-IA-3]

Introduced

Summary

Ban on "robovoting" for proxy and consent votes and tighter limits on outsourcing investor voting. This bill would direct the Securities and Exchange Commission to write rules that stop automatic voting that simply follows a proxy advisory firm's recommendations and that narrow who may be delegated voting authority.

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  • Institutional investors would have to perform independent review before using a proxy advisor's recommendation to cast votes. They could only delegate voting to a registered investment adviser or to a broker or dealer registered with the SEC or exempt from registration that owes a fiduciary or best-interest duty.
  • Proxy advisory firms would face limits on automatic voting via their platforms. Their recommendations could no longer be used to cast votes without client review and analysis.
  • Registered advisers and broker-dealers with fiduciary or best-interest duties would be the only third parties allowed to receive delegated voting power. That reduces outsourcing options for institutional vote execution.
  • No person could be required to cast votes related to proxy or consent solicitations unless a fiduciary duty or SEC Rule 206(4)-6 obliges them.

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Bill Overview

Analyzed Economic Effects

1 provisions identified: 0 benefits, 0 costs, 1 mixed.

Limits on automated proxy voting

This bill would require the SEC to issue rules banning "robovoting" for votes on proxy or consent solicitation materials. "Robovoting" would mean automatically voting with a proxy advisory firm's recommendation, including on the firm's electronic voting platform, without independent review and analysis. Institutional investors would be barred from outsourcing voting decisions except to an investment adviser. They could also outsource only to a broker or dealer that is registered with the SEC (or exempt from registration) and that owes a fiduciary or best-interest duty to the institutional investor. No person would be required to cast proxy votes unless a fiduciary duty or SEC Rule 206(4)-6 already obligates them to do so. The excerpt does not set an effective date, sunset, or provide new funding.

Sponsors & CoSponsors

Sponsor

Nunn, Zachary [R-IA-3]

IA • R

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

No roll call votes available for this bill.

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