May 10, 2007
Comments on the SEC Proxy Process Roundtable - May 7, 2007
Summary
The original and current regulatory limits to filing nonbinding shareholder proposals were designed in an era where manufacturing was dominant. In that environment, limiting the ability of shareholders to suggest "settings for the machinery" was entirely appropriate. This is, however, no longer the case.
We prefer that the ability of shareholders to put proposals forward be based on length of share ownership. Further, to eliminate identity fraud and duplicate vote issues, we suggest the creation of a unique, time sensitive share and holder identifier. The ability to vote would attach to the identifier and expire after a certain time period.
We believe technology allows for the efficient solicitation of opinions and votes from shareholders, using a secure on-line discussion area. The difference between a "chat room" and a secure on-line discussion area is akin to the difference between a bar and a private conference room. For proxy voting purposes, we prefer the latter.
We call for the adoption of technology enhanced, flexible proxy voting policies and procedures, based on market capitalization and the number and average tenure of shareholders.
William Michael Cunningham
Creative Investment Research, Inc.