investing

Do investors win with the Dodd-Frank Act?

Proxy access for shareholders
Proxy access for shareholders

The act gives the SEC the authority to give shareholders proxy access, or the ability to nominate the board of directors.

Based on the SEC proposals from last year, there will likely be a required percentage of shares owned in order to get proxy access, says Schlegel.

Though there are many unknowns about how things will shake out, one unknown has the potential to give small investors more influence in how corporations are run.

"There is a question of whether the SEC will allow shareholders to band together to get to that (ownership threshold)," Schlegel says.

"Directors choose the management of the company and they are looking out for the shareholders' best interest. Shareholders are a dispersed group, whether individual or institutional, so they need a voice as owners of the company. The board of directors is supposed to be that voice," says Schlegel.

But the people who land on corporate boards aren't typically watchdog types.

"It's a very closed community and tends to be an old-boy network," Schlegel says.

Allowing proxy access to those outside the club could allow shareholders to elect board members who will really look out for their best interests.

advertisement

          Connect with us
advertisement
CD & INVESTING NEWSLETTER

Learn the latest trends that will help grow your portfolio, plus tips on investing strategies. Delivered weekly.

CDs and Investment

How should my teen invest $150K?

Dear Dr. Don, My son will turn 18 years old in December. He has $150,000 from a settlement now sitting in the bank. What is the best plan to pursue for investing this money? Is investing in precious metals a good way to... Read more

advertisement

Blog

Dr Don Taylor

Earnings season, investing and you

Should individual investors try to anticipate financial results in an earnings report?  ... Read more

Partner Center
advertisement

Connect with us