Senator Christopher Dodd, the Connecticut Democrat who chairs the Senate Banking Committee, plans to unveil a revised financial reform bill on March 15.
It remains to be seen whether the new legislation will contain all of the governance provisions that appeared in the original bill, which included an annual “say on pay” vote mandate and authorization for the SEC to adopt a proxy access rule. Dodd’s original 1,136-page bill also included provisions to require majority voting in uncontested board elections and to require shareholder ratification of classified boards. The House of Representatives already has approved a narrower reform bill with advisory vote and proxy access language.
“Over the last few months, Banking Committee members have worked together to try and produce a consensus package,” Dodd said in a press release. “Together we have made significant progress and resolved a many of the items, but a few outstanding issues remain.”
While Dodd has been negotiating with Senator Bob Corker of Tennessee and other committee Republicans since December, the Republicans have not agreed to endorse Dodd’s revised legislation.
“It has always been my goal to produce a consensus package. And we have reached a point where bringing the bill to the full committee is the best course of action to achieve that end,” Dodd said. “I plan to hold a full committee markup the week of March 22.”
“Our talks will continue, and it is still our hope to come to agreement on a strong bill all of the Senate can be proud to support very soon,” Dodd said.
Senator Richard Shelby, the ranking Republican on the committee, said that an agreement on the bill is still possible. “If my Democrat colleagues are interested in enacting reforms that protect American taxpayers, promote economic growth, and preserve the competitiveness of our financial markets, there is no reason that we cannot reach an agreement,” Shelby said in a statement.
While agreeing that Dodd’s revised legislation “will be closer to a consensus package because of our efforts,” Corker said in a press release that the revised bill was not produced in a “bipartisan way.” In an interview with the National Journal, Corker warned that it would be a "travesty" to push this complex legislation through the committee in a week.
Jeff Mahoney, general counsel for the Council of Institutional Investors, said the group remains hopeful that majority voting and proxy access will be in the revised bill, but he noted that Corker and committee Republicans have drawn “a line in the sand” against access.
blog reported today that Dodd’s revised bill likely will include pay provisions derived from a recently introduced bill
by Senator Robert Menendez of New Jersey. That legislation calls for an annual advisory vote on compensation, separate shareholder votes on severance packages, limits on executive sales of equity awards during a five-year period after vesting, a new SEC rule to require issues to disclose the ratio of median employee compensation to the CEO’s pay, and stricter SEC rules on compensation “claw backs.”
The Democrats hold a 13-10 majority on the Banking Committee, and thus they have enough votes to get Dodd’s bill out of committee, but he would need to enlist a few Republicans to fend off a potential GOP filibuster on the Senate floor.