From: Smith, Gerard [gesmith@state.pa.us]
Sent: Wednesday, July 30, 2003 11:37 AM
To: 'rule-comments@sec.gov'
Subject: Proxy process for nominating and electing directors (S7-10-03
?)


July 30, 2003

Jonathan G. Katz, Secretary
U.S. Security and Exchange Commission
450 Fifth Street, NW
Washington, DC  20549-0609

Re:  Proxy process for nominating and electing directors

Dear Mr. Katz,

The following views are my own and are not necessarily those of the Pennsylvania 
Public School Employees' Retirement System or its staff.

First I'd like to commend the SEC's recent decision to require institutional 
investors to disclose their proxy votes.  In making this decision in spite of 
near unanimous mutual fund opposition, the SEC has sent a clear signal that it 
supports owners capitalism rather than managers capitalism.

Secondly, I want to support efforts to allow investors to place both nominations 
for directors and proposals for compensation policy and business conduct directly 
in proxies.  Your July 15, 2003 Staff Report, "Review of the Proxy Process Regarding 
the Nomination and Election of Directors" was another excellent step to make these 
changes happen.

In seeking how to best comment on the extensive array of questions and proposals 
within this Review, I have come up with a simple recommendation... ask John C. Bogle.

In my opinion, Mr. Bogle's record of representing the interests of shareholders is 
beyond reproach.  Finding an individual who is trusted by such large segments of both 
institutional and individual investors, and using their input to expedite your decision 
process, is the best recommendation I can offer.


Sincerely,

Gerard C. Smith, CFA
Managing Director of Equities
Public School Employees Retirement System
Commonwealth of Pennsylvania