SEC Provides Proxy Voting Guidance

June 30, 2014

The SEC’s Division of Investment Management issued Staff Legal Bulletin No. 20 which provides guidance about an investment adviser’s responsibilities in voting client proxies and retaining proxy advisory firms. In the bulletin, the SEC staff responds to 13 questions about Rule 206(4)-6 (the proxy voting rule) and the retention of proxy advisory firms. Among other issues, the bulletin addresses:

  • the steps that an investment adviser can take to demonstrate that proxy votes are cast in accordance with its clients’ best interests and the adviser’s proxy voting procedures;
  • whether an investment adviser is required to vote every proxy;
  • the considerations that an investment adviser should take into account if it retains a proxy advisory firm to assist it in its proxy voting duties; and
  • the extent to which an investment adviser has an ongoing duty to oversee a proxy advisory firm that it retains.

Click to access the bulletin.


Investment Advisers, Mutual Funds