From: Jack Thornton [jack_thornton@yahoo.com]
Sent: Sunday, September 22, 2002 1:14 AM
To: rule-comments@sec.gov
Subject: Petition for Rulemaking (SEC File No. 204-461)

Dear SEC,

In this time of economic upheaval and seemingly daily
uncovering of new instances of illegal corporate
greed, it is obvious to me that more needs to be done
to truly ensure that our public corporations are being
run for the good of shareholders, rather than as
'private piggy banks' for management.

It was a very welcome sign that corporate leaders are
required to personally attest to the accuracy of the
financial reports that are made to the SEC.  However,
that was a very minimal step - since those same
individuals have been responsible for accurately
reporting that information all along.  Knowingly
reporting inaccurate information was fraud before, so
I cannot see that that change is truly more than a
minor shift.

The changes that I would like to support are not
anarchist, nor are they draconian impediments to doing
business.  I strongly support American business, and I
believe that the keys to reducing the abuses that have
been coming to light involves ensuring that the
business owners (shareholders) have the ability to
control who runs the business.

Rescinding Rule 14a-(8)(i)(8) would be an excellent
way to improve that.  As I am sure you are aware, this
rule makes it nearly impossible for non-management
supported candidates to be elected to the Board of
Directors - this despite the fact that the Board is
supposed to represent the shareholders, not
management.

There have been very few outside directors
successfully nominated to any Board for publicly
traded companies.  The few exceptions have generally
been championed by major shareholders with an activist
approach.  Rescinding Rule 14a-(8)(i)(8) will allow
smaller shareholders to have a fair chance to nominate
Directors.  This would truly make Directorships the
responsibility of shareholders.

The argument against repealing that rule generally
hinges on the idea that by having management put
together the proxy list, the candidates have been
vetted for their ability to properly oversee the
company.  Unfortunately, this also means that they
have to satisfy management in order to be re-elected. 
That reliance upon management has resulted in clear
cases of lax or insufficient oversight on the part of
the Board of Directors.

Beyond rescinding Rule 14a-(8)(i)(8), you should also
look into requiring senior management and directorship
compensation packages to be voted upon by
shareholders.  This includes everything from salary to
stock options, perks and incentive rewards.  This
requirement would help ensure that shareholders know
how management is being compensated for looking after
the shareholder's interests.  It will also allow
shareholder groups to ensure that management is
oriented toward the goals that shareholders want by
aligning management compensation with shareholder
goals.

It is possible that allowing shareholders to have a
voice in that process will result in significant
changes - hopefully to even out the major divide
between management compensation and companies fiscal
results.  I am talking about the fact that CEOs can
reap millions in compensation while setting records
for company losses and decreases in shareholder value.
 This change could result in CEOs being denied
adequate compensation, but shareholder bodies that are
unwilling to provide fair compensation will discover
that they must settle for less adequate management in
return.

These two changes together would not only help make
Directors truly independent from management, it would
also restore a lot of confidence in America's public
companies - a quality which is sorely lacking right
now.  Neither of these proposals are draconian in
nature, and both can be reasonable implemented in a
quick period of time.  The costs would quickly be paid
back in renewed investor confidence, and in the
ability of corporations to easily raise additional
funds for continued growth and expansion of the
American economy.

Should you have any questions or want more detailed
and specific comments, feel free to contact me at this
e-mail address or via the Postal Service at 1949 S
Linda Vista Ave, Boise ID, 83709.

Thank you,

Jack Thornton
Shareholder
Boise, ID

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