SEC sign-on letter


The United States is the largest financial market in the world, with investors around the globe holding direct and indirect stakes in myriad US companies. The SEC proposals, if adopted, will have significant international impacts.

The proposed rules stand in direct contradiction of the SEC’s stated purpose, to protect investors. Ultimately, they would put more power into the hands of CEOs and corporate boards, weaken shareholder protection, especially for smaller investors and diminish basic transparency and corporate accountability. They are in effect a form of corporate voter suppression to disenfranchise investors who seek to actively engage with companies on ESG matters, climate risks, sustainability and long-term value creation.

Signatories can sign the PRI's sign-on letter to the SEC, opposing these changes, through the collaboration platform or by emailing

The deadline to sign onto this letter is January 31st, 2020. The list of signatories will be updated on a weekly basis until the deadline.

The letter has been posted in both of the SEC's comment files: Rule 14a-8 and Proxy Voting Advice.

December 9, 2019

Ms. Vanessa Countryman
Securities and Exchange Commission
100 F Street N.E.
Washington, D.C. 20549

File numbers: S7-23-19; S7-22-19

Dear Ms. Countryman,

The PRI and its undersigned signatories write to urge you to ensure that the SEC preserve the right of shareholders to make their voices heard and the independence of proxy voting advice. If finalized, the SEC’s proposed rules on shareholder proposals and proxy advisers would introduce major impediments to environmental, social and governance (ESG) integration, which has traditionally depended on dedicated investors engaging with management and access to independent and efficient proxy voting advice.

The shareholder proposal process is critical to the advancement of ESG integration in the US and the fulfilment of the second PRI principle, active ownership. Shareholder proposals are a component of fundamental investor rights in the US. They enable investors to engage with the companies they own at annual elections on critical issues. Those issues include but are not limited to: corporate transparency, executive compensation and climate change. The proposed changes to the 14a-8 thresholds significantly raise the ownership requirements and the percentage vote a proposal must receive to be resubmitted, making it more difficult to submit and sustain proposals. That’s especially the case for ESG resolutions, because the reality is that it often takes several years for the investor community to appreciate the importance of an emerging ESG topic and integrate the appropriate response into their voting decisions. Accordingly, if finalized, the SEC’s proposed amendments to Rule 14a-8 would in many cases hinder discussion of emerging ESG issues before investors have the chance to analyze and incorporate the latest thinking into voting behavior.

Moreover, proxy advisory firms play a vital role in providing impartial analyses of and recommendations on corporate issues that are important to investors. Many PRI signatories make use of the information from proxy advisers when assessing how to vote their shares. But requiring proxy advisory firms to allow companies to review and comment on recommendations before investors even see them, as the SEC has proposed, is an unprecedented intrusion of management into this arena, greatly limiting investors’ access to independent advice on matters brought to a vote in corporate elections. The PRI is deeply concerned that the SEC’s proposed rule will undermine the reliability of this source of advice and cause unwarranted delays in an already compressed process. These hurdles will likely make it harder for investors to carry out their fiduciary responsibilities.

Any rulemakings should address the concerns set out in this letter. We urge you to preserve the existing framework and look forward to working with you to make sure that these important elements of shareholder democracy are maintained.

Thank you for the opportunity to share our views. For further conversation and follow up, please feel free to contact our policy team:

Yours sincerely,

Fiona Reynolds
Chief Executive Officer
Principles for Responsible Investment

cc. The Honorable Jay Clayton, Chairman
The Honorable Robert J. Jackson, Jr., Commissioner
The Honorable Hester M. Peirce, Commissioner
The Honorable Elad L. Roisman, Commissioner
The Honorable Allison H. Lee, Commissioner

Over 190 signatories have signed onto the letter to the SEC. To see the full list of names submitted to the SEC please download the letter here