September 26, 2014
Now that the SEC-IAC has addressed Impartiality in the 'Disclosure of Preliminary Voting Results' in their paper of the same title, I hope the Committee will take up the issue of impartiality in writing the Voter Information Form (VIF) and counting the votes cast on behalf of shareholders. As acknowledged in footnote 38 of the above named paper, these issues were discussed in detail in the May 15, 2009 rulemaking petition and the April 2014 DU Online Law Review article.
Brokers distributing VIFs have an obligation to act in an 'impartial' manner. Yet, the SEC continues to allow brokers to vote for unvoted VIFs on 'routine' matters and to fill in votes left blank for partially voted VIFs. I submit there that after the behavior of auditor Arthur Andersen in the Enron case, there are no 'routine' matters and that items left blank should be counted as abstentions or the rules applicable to proxies regarding bold type etc. should apply to VIFs.
Additionally, VIFs should be prohibited from describing proxy ballot items using wording, headings or fonts that differ from those used on the related proxy card," as the Council of Institutional Investors (CII) pointed out in their letter of April 4, 2013 to the SEC at http://www.cii.org/files/issues_and_advocacy/correspondence/2013/04_05_13_cii_letter_to_nyse_on_proxy_distribution_fees.pdf.
Impartiality should apply equally to disclosure of votes and to the behavior of intermediaries with regard to drafting VIFs and voting itself. The current process tips the scales in favor of entrenched boards by misleading retail shareholders. Please advise the Commission on how to remedy this unfair situation.