Feb. 3, 2020
February 3, 2020 Hon. Jay Clayton Chairman U.S. Securities and Exchange Commission 100 F Street, N.E. Washington, D.C. 20549 Re: S7-23-19 Procedural Requirements and Resubmission Thresholds under Exchange Act Rule 14a-8 Dear Chairman Clayton, We strongly oppose the rules proposed by the Securities and Exchange Commission (SEC) on November 5th, 2019, which will severely limit the rights of shareholders to engage with corporations using the shareholder resolution process over issues with a distinct impact on long-term value. The JLens Investor Network is a network of institutional investors who seek to apply a Jewish lens to values-based investing. We invest Jewish communal capital in 300 of the most influential US public companies and advocate based on Jewish values for social, environmental, and pro-Israel issues. As long-term investors who engage with companies on critical environmental, social, and governance (ESG) issues, we believe that the proposed rules are unnecessary, and will undermine a corporate engagement process that has been of great value to both companies and investors. For decades, the shareholder proposal process has served to benefit issuers and proponents alike as an effective, efficient and valuable tool for corporate management and boards to gain a better understanding of shareholder priorities and concerns. The proposed rule changes will make companies far less accountable to shareholders, stakeholders, and the public at large. The proposed increase in ownership thresholds will make it difficult for smaller investors to voice important concerns and raise issues of risk to the companies they own. The current ownership threshold of $2,000 ensures that a diversity of voices are heard, not just the biggest players. Small investors have contributed a multitude of now commonplace best practices. According to data compiled by the Sustainable Investments Institute, 187 resolutions on social and environmental topics came to a vote at US companies in the spring of 2019. Many of these were filed by investors with relatively small stakes consistent with the existing filing thresholds. The proposals received an average of 25.6 % support (about the same as the average of 25.4% for resolutions of this kind in 2018, and 21.4% in 2017). These numbers demonstrate that proposals of interest to a large portion of a company’s shareholder base can and do originate with smaller individual and institutional investors. (Si2 ‘FACT SHEET: Shareholder Proposal Trends’, Sustainable Investments Institute, Oct.17, 2019, https://siinstitute.org/special_report.cgi?id=80) Excluding this group of shareholders until they have held for three continuous years raises serious questions about the equity of the proposal process and leaves smaller investors who can make valuable contributions without access to the proxy. We strongly urge the SEC to reconsider the proposed rule changes. Sincerely, Rabbi Joshua Ratner Director Of Advocacy JLens Investor Network rabbiratner@jlensnetwork.org [redacted] (office) [redacted] (cell) [redacted]