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119-s-3055119th CongressWALLET

Corporate Governance Fairness Act

Sponsored By: Senator Reed, Jack [D-RI]

Introduced

Summary

Brings proxy advisory firms explicitly into the Investment Advisers Act and increases federal oversight. This bill would define who counts as a proxy advisory firm, set a revenue exclusion with an opt-in, require registration for others, mandate inspections and record access, and force regular reports to Congress to improve transparency and reduce conflicts of interest.

Show full summary
  • Proxy advisory firms would be defined by the bill and excluded only if consolidated client revenues do not exceed a GDP-adjusted $5 million or if they elect exclusion. They would face new recordkeeping rules and must make records available for inspections beginning within one year of enactment.
  • Investors and issuers would get clearer disclosures and policies aimed at preventing false or misleading proxy recommendations and better access to material information needed to make voting and investment decisions.
  • The Commission must report to key congressional committees within two years and provide updates not less than every five years, while retaining authority to require additional exams and information as needed to protect investors.

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 2 benefits, 0 costs, 1 mixed.

SEC inspections of proxy advisers

This bill would require the SEC to start periodic inspections of covered proxy advisory firms within one year of enactment. Inspections would check for false or misleading statements and review conflicts-of-interest policies and programs. The SEC would report to Congress within two years and update that report at least every five years.

New rules for proxy advisers

This bill would treat proxy advisory firms as investment advisers under the Investment Advisers Act. If enacted, those firms would generally have to follow adviser rules and duties. That could raise compliance costs for firms and increase protections for investors.

Exemption for small proxy firms

This bill would exclude proxy firms and their affiliates with $5,000,000 or less in client revenue in a fiscal year. The SEC would adjust the $5,000,000 threshold each year by U.S. GDP changes. Firms that meet the exclusion could choose to opt in and accept adviser obligations.

Sponsors & CoSponsors

Sponsor

Reed, Jack [D-RI]

RI • D

Cosponsors

  • Sen. Tillis, Thomas [R-NC]

    NC • R

    Sponsored 10/23/2025

Roll Call Votes

No roll call votes available for this bill.

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