The Securities and Exchange Commission will propose rules next week to require firms to give shareholders more information on corporate board elections.
The rule-making follows an SEC staff report issued July 15 that recommended having companies disclose how directors are nominated, how investors can offer their own nominees and who shareholders can contact on the board.
The proposal is the first of two before the SEC on how corporate elections are conducted. SEC Chairman William Donaldson said a second rule would address letting shareholders put their own candidates on company proxy ballots.
Shareholders have said existing rules make challenges to a board’s leadership expensive to mount and difficult to win.
The SEC wants to issue proposed rules on the shareholder nominations by September, Donaldson said. The rules on expanded disclosures will be proposed at an open commission meeting Aug. 6, the SEC announced Tuesday.
From Bloomberg News