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 Number 3-95
 SEC Commissioner Wallman invites Society help proposed company registration SEC Commissioner Steven Wallman has welcomed direct involvement by the Society as the Commission's Advisory Committee on Capital Formation and Regulatory Processes, headed by the Commissioner, drafts plans for a voluntary company registration system. At Wallman's request, several members of the Society's Securities Law and Corporate Practices Committees met recently in New York with the Commissioner and David Sirignano of the Division of Corporation Finance to offer input on a Draft system Term Sheet prepared for the Advisory Committee concerning the proposed new registration system. The meeting was held at the offices of Society member Donald Fried at Hunton & Williams. Fried helped prepare the report below. [Wallman addressed the purposes and directions of the new SEC Committee during the Society's National Conference at the Greenbrier in June and has been invited to discuss the committee's progress further during the upcoming Issues Update seminar in New York, November 13-14 (see article in this newsletter). The Society had also previously filed comments on an earlier Draft Term Sheet, supporting establishment of a system to reduce the costs of raising capital by (1) eliminating the distinctions between registered and unregistered securities, (2) shortening the period between a decision to go to the capital markets and the actual sale of securities, and (3) reducing the transaction costs by dramatically simplifying the process. In addition, Society member Karl Barnickol has been a welcomed observer at meetings of the Advisory Committee.]  Under the system, according to the Commission document, "registration... would be [, for the most part,] company [and] not transaction-based .... Once meeting eligibility standards, companies register with the SEC (comparable to current registration under the 1934 Act) and file periodic reports. Routine financing, as well as sales by affiliates and sales of ["registered shares"] could be consummated without the review and registration process. Information provided to investors in the marketing of these routine financings [would] be based on what the market demands and on company and transactional information filed as part of the issuer's periodic reports. The principal distinctions currently existing between public and nonpublic offerings by registered companies (with the resultant formalities and restrictive concepts such as gun-jumping and integration) would be eliminated since offers and sales by companies already registered with the SEC would not generally be subject to additional transactional registration requirements." The new system would eventually be available to all publicly-held companies. However, the SEC plans an experimental phase-in process, beginning, on a voluntary basis, with S-3 companies. Some benefits of the new system would be redefining "affiliates" to include only 20 percent shareholders, the CEO and inside directors; discontinuation of private placements and private placement "haircuts"; elimination of the "presumptive underwriter doctrine"; and facilitation of small acquisitions. While the benefits accruing to large companies filing global shelf registration statements may be marginal, the advantages of a company registration system to other issuers could be substantial. The new system would, however, require so-called "disclosure enhancements" designed to improve the level and reliability of secondary market disclosure. These disclosure enhancements were discussed at the New York meeting. For example, the Draft Term Sheet calls for requiring CEO and CFO certifications for all 10-Q and 10 -K filings, in connection with each material issuance of securities, and even with respect to 8-K filings. The Society representatives pointed out that the latter certification might not be practical when coupled with a shortening of the time for filing Forms 8-K from 15 to 5 days. Another disclosure enhancement the Society members regarded as "needless boilerplate" would require a report, filed as a 10-K Exhibit, prepared by management and submitted to the audit committee describing procedures followed to ensure the integrity of the secondary market disclosures. On the other hand, the rationale for requiring such a report is to encourage registrants who have not implemented appropriate procedures to ensure the accuracy and integrity of '34 Act filings to do so. A third disclosure effort questioned by the Society representatives calls for risk factor disclosure to be added to Form 10-K under the caption "Risk Factors." While Wallman maintained that there was no intention to expand the number of registrants required to discuss risk factors in their filings from that existing under present '33 Act requirements, ASCS members pointed out that risk factors that might not be relevant to debt offerings might have to be discussed in the context of equity offerings and that issuers who rarely have primary equity offerings do have exempt Rule 144 sales by affiliates which would be registered offerings under the new system. Wallman suggested that a different caption -e.g., "Investment Considerations" - might be in order. Copies of the revised Draft Term Sheet and the Society's comment letter on the earlier version are available from Blanca Rosbach in the National Office at (212) 681-2010. Commissioner Wallman would welcome comments and suggestions on the company registration concept. These should be sent to his attention at the SEC, 4S0 Fifth Street, NW, Washington, DC 20549 with copies sent to Society member Karl Barnickol at Monsanto Company, 800 North Lindbergh, E2ND, St. Louis, MO 63167. FROM THE CHAIRMAN Fellow Members: More importantly, we are exploring the connections between today's corporate secretaries and those who have come before us -- the men and women who pioneered the corporate governance and corporate administrative activities that are so much a part of our work lives today and who first willingly shared their knowledge and experience with each other through active participation in Society groups and activities. The Society very much appreciates the support that many of you and your corporations have provided towards the commemoration of our 50th Anniversary. I invite you to celebrate with us throughout the year -- in articles and activities focusing on the Society's first 50 years -- and hope you will be a part of the festivities in Seattle in June. There are many other Society activities planned for this year in which I hope you will participate. Nearly all of the Society's local chapters are cosponsoring fall conferences around the country in September and October. Panels and speakers at these meetings will provide vital information on the pressing issues of 1995 and 1996. And, just as importantly, they will provide an opportunity to meet, work and socialize with colleagues. I hope you will be able to take advantage of your chapter's conference. The Society's new seminar season is also upon us. Of particular note is the 18th annual Issues Update scheduled in New York, November 13-14. There will be close analysis of current SEC activity at the session, including an in-depth look at the Commission's work in the area of company registration and capital formation. You can also expect practical discussion on how to handle director compensation and benefits more effectively and how to achieve cost savings in different aspects of shareholder communications, among other topics. The fall also marks the beginning of the Society's annual membership drive. I have written to many of
those corporate secretaries who have not yet joined the Society inviting them to join and realize the
special benefits of participation in the Society -- networking, reference information, publications and
surveys, education and advocacy, to name just a few. I urge each of you to reach out to nonmembers you
may know and encourage them to join and share in the unique benefits of the Society.
 Issues Update '95 combines theory and practice An outstanding faculty of SEC regulators, governance experts, corporate secretaries, attorneys, compensation consultants and accountants will take part in panel discussions and lead breakout groups at the Society's 18th annual Issues Update seminar, set for November 13-14 in New York. Stephen Norman, the Society's immediate past Chairman, is chairing the program. Among seminar highlights will be an "SEC Update" panel featuring Linda Quinn, Director of the SEC's Division of Corporation Finance. Quinn will be joined by members of the Society's Securities Law Committee to analyze the progress and potential impact of recent Commission initiatives designed to streamline proxy disclosure and simplify financial reports, among other things. In addition, SEC Commissioner Steven Wallman has been invited to provide further insights on the activities of an SEC advisory committee he heads that is looking into capital formation and company registration. Other panels will focus on "The Board's Role in Building Shareholder Value"; "New Ideas and Issues in Director Compensation"; and "Cost Saving Ideas for the Corporate Secretary" (e.g., using a summary annual report and how to save in the proxy process). The seminar will also include a series of breakout sessions on "nuts and bolts" topics such as board evaluation procedures, director and executive compensation disclosure, surviving the proxy contest, and outsourcing legal matters cost effectively. Society members who have agreed to share their expertise on the faculty include: Wayne Coon, Albert Driver, Edward Fleischman, Margaret Foran, Gordon Garney, Carol Hayes, Brian Henry, John Hetherington, Craig Nordlund and Carol Ward. For more information on the seminar program and registration, contact Suzanne Walker at (212) 681-2008. Members describe governance principles adoption [The Society's Corporate Practices Committee is sponsoring a new newsletter feature -- articles that will focus on "Best Practices" of companies represented in the Society's membership. This first article, written by Committee Chair Cheryl Sorokin of BankAmerica Corporation, focuses on corporate governance principles adopted by a number of American corporations.] Got any principles? Of the corporate governance type, that is. These days it's not enough just to have them. If CalPERS is one of your investors, you may even get graded on them! Of course, many companies have yet to engage in a formal corporate governance review process, despite all of the publicity on the GM principles and CalPERS' requests for a board level review of corporate governance practices at an ever-expanding number of companies. But the focus on corporate governance is continuing, and it appears likely that the trend toward going through a formal review process will continue. In view of this, the Corporate Practices Committee thought Society members might benefit from hearing the experiences of several members whose companies have adopted formal principles: How they got started in the review process? Who took the lead in the discussion with the board? What materials went to the board? What was the end result? BankAmerica's 2-year process Since I volunteered to write this column, I'll begin with events at BankAmerica. At BAC, we didn't start out to adopt principles. They were the natural outcome of a two-year process that really had three distinct parts: (a} a general review of the corporate governance issues; (b) a board effectiveness review; and (c) the adoption of formal principles. The process started with a suggestion from me to the Chairman and CEO that the Executive Committee conduct a formal review of current corporate governance topics at one of its quarterly meetings. Notwithstanding a slight rolling of the eyes and an expression of concern that an entire agenda on this topic might be a bit too academic and boring, the topic was scheduled for one of the Executive Committee's quarterly agendas. In preparation for that meeting, I re-reviewed a substantial amount of the corporate governance literature and prepared a four-column chart* (copies of this and other starred items are available from the Society National Office) for the Executive Committee which listed general corporate governance issues, ranging from "givens" to the controversial, provided a synopsis of the general thinking of competing views on the topic, and a summary of BAC's current practice (at least in the eyes of the Chairman and me!) The fourth column was left blank for director notes as they reviewed the material. The chart then became a roadmap for the committee's discussion, which, of course, ranged beyond items listed. The list of specific issues, along with a summary of our company practices, helped focus the discussion. The committee was able quickly to identify areas in which there might be room for improvement, those in which BAC might be already in a leadership position, or those for which the directors had a slightly different view on BAC's performance than the Chairman and the Secretary. Following the meeting, I provided a synopsis of the committee's discussion using the blank fourth column on the chart, so that the comments were juxtaposed against the material the committee had reviewed at the meeting. At a subsequent regularly scheduled meeting, the committee again reviewed the completed chart and offered further comments and refinements. The final chart was then sent to the board, where the Chairman of the Executive Committee (an outside director) led a discussion on the review process and results and principles adoption offered the full board the opportunity to comment and refine. The following board year, the Executive Committee, now comfortable in its role in reviewing the company's corporate governance health, began a review of "board effectiveness," a process somewhat overlapping the review of corporate governance issues of the prior year, but more directed at specific board practices such as rotation of committees, frequency of meetings, establishment of agendas, etc. The effectiveness review started with a one-page list of practices* developed by the Corporate Secretary's Office. The committee was then asked to rate BAC's performance in each area and to elaborate with additional comments at the meeting. To limit the potential list of items to be rated, like items were grouped together. I met with each committee member following the meeting to give the directors an opportunity to discuss effectiveness outside of the group setting. Results were summarized in chart format*, with each director's comments in a separate column but next to those of other directors on the same topic. Directors' names were not listed on the chart, though committee members were not shy about identifying their own comments when the summaries were reviewed at a subsequent meeting. The chart was then reviewed with the full board by the Chairman of the Executive Committee, and board members provided additional comments on the material. At the suggestion of the Chairman of the Executive Committee, the results of the effectiveness review and the corporate governance review were subsequently "recast" into the form of principles,* which were reviewed by the Executive Committee and then the full board and finally adopted by the full board. The entire process resulted in the adoption of principles that really "fit" BAC, refinements to certain board practices that grew out of recommendations from the full board after careful consideration and, perhaps more important, the development of a common understanding among our board members of major corporate governance issues and their applicability to the deliberations of the BankAmerica board. Finally, the existence of formal principles will ensure continuing review of these issues by the board to make sure they remain appropriate over time. Eastman Chemical begins at the beginning John Bracy, General Counsel of Eastman Chemical Company, which went public in January 1994 after its spin off from Eastman Kodak, had the good fortune to be able to structure the new company's board and committee charters and their practices based on current "best practices" right from the company's inception. In preparation for going public, Eastman's CEO had developed his own list of practices which he thought should be considered for possible implementation. Armed with this list, Bracy then talked to a number of other general counsel about board practices and policies they considered effective and those they would change. With the information gathered and following discussions with the CEO, Bracy helped draft the bylaws which were then presented to the board for adoption. Thus, at the time of adoption in early January 1994, there was no need for a separate, formal discussion of corporate governance issues, as the bylaws themselves generally reflected current recommendations on corporate governance practices. When the GM guidelines were published shortly thereafter, Eastman's Committee on Directors reviewed the guidelines and found that the company's newly established bylaws already addressed most of the matters covered in the guidelines. Based on suggestions and material developed by the CEO -- and with a little polishing by the committee -- a set of formal principles were prepared based on the practices incorporated in Eastman's bylaws. The principles were then presented to the full board for ratification and adopted in February 1995. Phillips responds to CalPERS letter At Phillips Petroleum Company, a formal corporate governance review was initiated after the company received the now-famous CalPERS letter. The CEO, who had been keeping abreast of corporate governance issues, agreed that a governance review could be helpful to the company. He asked the General Counsel and the Secretary to establish a process for carrying out such a review using the Nominating Committee, which is composed solely of independent directors. The Nominating Committee first wanted to look at the company's practices in relation to those in place at GM and those set forth by Martin Lipton of Wachtell, Lipton, Rosen & Katz. Phillips Secretary Dale Billam worked with the Nominating Committee chairman (via phone, FAX and meetings) to develop materials to be presented to the Committee. They agreed on a three-column chart format listing the GM principles in the first column, Lipton's principles in the second and a summary of Phillips' current practices in the area in question, with an indication of whether the Phillips practice was an informal one or was formally incorporated in committee charters, the bylaws or board adopted policies, etc. The chart was sent in advance to Nominating Committee members. Over the course of several meetings, the Committee discussed the chart entries and assessed company practices. The Chairman was present for most, but not all, of the discussions. Billam then prepared a new chart showing the company's existing policies and the Nominating Committee's preliminary recommendations. The chart was sent to the full board with a request that comments be returned to the Nominating Committee Chair or the Secretary. The committee finalized recommendations, which the board adopted as the Phillips "Corporate Governance Policies Affecting Outside Directors," a document addressing corporate governance issues in three areas: the Chairman and management, board operations and board membership. Chase's three-column approach At Chase Manhattan, the board's Governance Committee (formerly the Nominating Committee), consisting solely of outside directors, is responsible for reviewing corporate governance issues. The committee compared Chase's practices to the GM principles, using a three-column chart which listed (a) the GM principles; (b) Chase's practices, along with comments on those practices prepared by the Secretary; and (c) a blank column for director comments. The CEO reviewed the Secretary's draft of the chart before it was sent to the committee. While neither the CEO nor the Governance Committee viewed the GM principles as a "model" to be followed, they felt the GM principles were a useful starting point for discussion purposes. On that basis, the Governance Committee reviewed the chart, made changes in the second column based on the committee views of Chase's current practices and suggested several modifications to practices. This process took two meetings. Following the Governance Committee's review, Chase Secretary Ron Mayer prepared a chart for the full board listing only Chase's practices and the committee's relatively few recommendations for changes in certain practices. The board concurred in the committee's recommendations. While the review resulted in a formal document, Chase has not published it for external distribution. Mayer reports that since the review was completed about a year ago, the Chairman thought it appropriate to have the document reviewed again by the Governance Committee. This review was recently completed, with the committee making minor clarifications to the document and agreeing that such a review should be conducted periodically. Mayer also indicated that separate from the corporate governance review, the Chase board has conducted a "board evaluation" process, using a modification of the questionnaire format prepared by the National Association of Corporate Directors. The questionnaire was distributed to the full board, and responses - numerical rating and comments from directors -- were summarized by the Corporate Secretary's Office and then reviewed by the Governance Committee and the full board. PacifiCorp's evolving process PacifiCorp doesn't have formal corporate governance guidelines in a single document adopted by the board. Sally Nofziger, Vice President and Secretary, reports that the development of corporate governance principles at PacifiCorp has been evolving over many years, beginning in the 1970s when the charter for the Nominating Committee established criteria for board service, retirement of directors and other issues addressed by the GM principles. Although PacifiCorp's board has not set out in one document a set of governance guidelines in the manner adopted by GM, all of the principles contained in those guidelines are observed by PacifiCorp, specified separately in the company bylaws, in resolutions establishing and delegating authority to committees of the board, or simply in the tradition of how the board conducts its business. (Nofziger notes that Society publications have been provided to the Chairman and the CEO for many years and have kept the board up-to-date on corporate governance issues and solutions to specific problems as they have arisen.) PacifiCorp's Nominating Committee was renamed the Committee on Directors in 1992 and delegated responsibility for assessing the capacity of the board to fulfill the requirements of the policy adopted by the board with respect to the qualifications, resources and experience, and performance and contribution of directors. In late 1994, the board charged the Committee on Directors, in partnership with the Personnel Committee, with development of a more formal process for evaluating the performance and effectiveness of the Chairman, the CEO, the board as a whole, and individual directors. Those committees, with the assistance of the Corporate Secretary and the resources of the Society, developed an evaluation questionnaire for completion by all directors, inquiring about the board's procedures for effective meetings, communication with management and the committee structure and function. Questionnaire responses were consolidated by the Secretary and provided to all directors. As a result of the Board's review of the evaluation survey results, several recommendations were adopted related to board meeting procedures, including allocation of additional meeting time to focus on certain matters. Some changes were also made in materials provided to directors in advance of the meeting. The board also reviewed a policy it had established in 1992 related to evaluation of the performance of individual directors and concluded that the existing policy was appropriate and agreed that the environment for free and open communication among directors and between the board and management would be maintained. The evaluation of the Chairman and of the President and CEO was conducted separately in executive session with only nonemployee directors present, comparing performance to position descriptions developed for each position by the two committees. Many Society members have been involved in developing corporate governance principles and are willing to share their experiences with others embarking on the process. Those I spoke to include: John Bracy of Eastman Chemical Company (615-229-4497); Dale Billam of Phillips Petroleum Company (918-661-5638); Ron Mayer of The Chase Manhattan Corporation (212-552-3490); and Sally Nofziger of PacifiCorp (503731-2144). My number at BankAmerica Corporation is (415) 622-2091. Society comments on compensation disclosure proposals In a comment letter to the SEC concerning the Commission's recently proposed rules relating to Executive and Director Compensation Disclosure (Release Nos. 33-7184, 3435874), the Society's Securities Law Committee focused on the question of how much disclosure is needed in the proxy or information statement in order to permit shareholders to judge director stewardship of a corporation. The Committee's recommendations call for, among other things, retaining the Summary Compensation Table, together with the Option/SAR Grants Table in the proxy statement. In addition, the Board Compensation Committee Report on Executive Compensation is also best located in the proxy statement, since it is a statement of the directors' current philosophy and a summary of compensation decisions for the prior fiscal year. On the other hand, the Committee suggested that the Aggregated Option/SAR Exercises and Fiscal Year-end Option/SAR Value Table, which does not reflect any current action of the directors, should, as the release proposes, be moved out of the proxy statement (and might even be eliminated, according to the committee, since the information reflects appreciation in market value of the stock which benefits all shareholders). The committee further commented that if tables are to be moved to the 10-K, that they remain in that document and not be moved back into the proxy statement whenever an issuer is presenting a new benefit plan to shareholders, as proposed in the release. The committee also strongly disagreed with the proposal that registrants be permitted to move executive compensation disclosures to the 10-K only if the 10-K is filed prior to or at the same time as the proxy statement is sent to shareholders. In other comments, the committee suggested eliminating disclosure of Defined Benefit Plans and tax-driven SERPs; requiring companies to report long-term incentive awards in narrative form and eliminating the long term incentive award table; moving information which could be disclosed under Employment Contracts and Termination of Employment and Change-in-Control Arrangements to the 1O-K; giving companies the option of moving the Performance Graph from the proxy statement (where it is an anomaly) to the 10-K. Commenting on director compensation disclosure proposals, the committee agreed that a tabular format for disclosure should be adopted but noted concern with the proposal that would allow companies to list either the standard fee arrangement or the actual fees paid. "We think that the format should be uniform for all companies and would suggest that the 'standard fee' form be adopted. This would allow use of a shorter table which could contain a single line showing the standard arrangement and subsequent lines showing any deviation from the standard." The committee also expressed concern with a proposal to include consulting and other fees in the table since these arrangements represent a demand on the director's time beyond normal service on the board and generally should be considered separately from normal director compensation. Including the fees in the table will give a mistaken impression that could be avoided by an explanation in narrative form instead. Copies of the Society letter are available from Blanca Rosbach or Stephanie Pain in the National Office at (212) 681-2010. Society honoree Jerry Breslow "gets it right" [At the Society's National Conference in June, Jerome Breslow of COMSAT Corporation was honored as the sixth recipient of the Society's Distinguished Service Award. Below are the remarks he delivered at the award ceremony.] When Steve Norman called to let me know I was to receive the Distinguished Service Award, after I got over the pleasant surprise, I began to think about what it meant -- to me, and in general. I want to share my thoughts with all of you. I am a good Corporate Secretary. Why is that? How did it happen? One reason may be illustrated by the following story. A young American tenor went to Italy to study opera. He got a job at a small opera house in Verona, where the patrons took their opera very seriously. His first starring role was that of Canio, the clown in the opera Pagliacci, whose big aria is the famous Vesti la giubba, which he sings near the end of the opera, just before he stabs the heroine. The American sang the aria, and, when he finished, all of the members of the audience jumped to their feet and people began to cry out, "Encore!", "Sing it again! Sing it again!" He sang the aria once more, and again the audience as one shouted "Encore! Encore!" The tenor went to the front of the stage and said, "My friends, I am overwhelmed. However, I cannot sing Vesti la giubba again, for I shall have no voice left to finish the opera." At that, a patron in the third row called out, "You'll sing it 'til you get it right!" In 1966, when I was hired by the Corporate Secretary at COMSAT, one of my first responsibilities was to run the Annual Meeting. By the time I retired last summer, I had run 28 annual meetings. With that amount of practice, I know how to "sing it right." But practice is only a minor reason for my success. The major reason I became a good Corporate Secretary is that I was fortunate enough to belong to the American Society of Corporate Secretaries. It is because the people in this room, and other members who are not here tonight, taught me how to be one. When I joined the Corporate Secretary's office, I didn't have the foggiest understanding of his areas of responsibility. Securities law, proxy statements and the proxy solicitation process were mysteries to me. I had never attended a board meeting, drafted notices and minutes or prepared a meeting agenda. The wonders of stock transfer were beyond my ken. As in any job, you learn by doing; so, slowly, I began to learn. Then my boss introduced me to Bracebridge Young and the staff of the National Office. That is when my education began in earnest. When I became eligible and joined the Society in 1969, I began to meet other members at regional group meetings and National Conferences. I learned that answers, advice and experience were just a telephone call away. When I got involved in the work of the Society committees, I got to know bright and knowledgeable people. People like Dick Hays, Bill Robinson and Don Pease, just to name three out of the scores of Society members I have called on over the past quarter of a century. (If I tried to mention everyone, we would be here until dawn.) They gave me, for free, a graduate degree in the Corporate Secretarial function. They never turned me down when I asked for help. The spirit of sharing is uniquely a trait of members of the Society. I have shared confidences with many of them. When they asked me questions, I freely responded because I knew I would be shown the same courtesy. Another source of assistance to me were the people in the National Office. I have been fortunate in that I have known and worked with all of the executive directors and presidents of the Society from Brace Young to David Smith. Each one contributed in his own special way. David, you have been a perfect choice for President at this time in the Society's life. Over the years, members of the staff, such as Skip White, Bob Pyle (when he was the Society's counsel) and Blanca Rosbach, among many, all have given me the support and information I have needed. That help is what made me a good Corporate Secretary. And the key to getting the help I got was participation in the Society. The lesson is simple: to get, you have to give. I have served on many committees, taught courses, made presentations, led songfests and put a lot of effort into supporting the activities of the Society. But let me tell you something -- it wasn't work; no, it was a labor of love. Moreover, this love was requited; for what I put in, I got back tenfold. I am honored and flattered to receive the Distinguished Service Award. I am proud to join a very select group. I have known and worked with almost all of them. I am most pleased that I am associated with my dear friend Vic Futter. Vic has been a role model for me. Moreover, Harriet and I have spent many wonderful hours with Joan and Vic, and I am delighted that my name will be next to Vic's on the bowl. In closing, I want to thank all of you for your help and your friendship. Although I am retired, I'm not dead. I plan to keep working, both for the Society, which means so much to me, and otherwise. I will admit, however, that no longer being Corporate Secretary has made a difference in my life. Part of it is no longer having access to a board room. But it is more than that. It is summed up in a paraphrase of what General Douglas MacArthur said to the U.S. Congress when he retired from the Army. Old Secretaries never die; people just stop taking notice. Thank you for taking notice.
SOCIETY NOTES
Just what is available in the Core Document Files. A new checklist is enclosed with this newsletter. You can use it to indicate the specific areas for which you would like to receive sample documents. The documents will be sent to you by mail or FAX at a nominal fee for photocopying and/or transmission. And a reminder...Even when the National Office is closed, our phone lines are always open. You can leave a recorded request for reference information outside of New York business hours, and someone from the National Office staff will respond to your request the following business day. Suzanne Walker receives promotion
Two former Chairmen die Members speak at IRRC forum House bill would overhaul securities regulations A new bill introduced by Republican legislators in the House of Representatives calls for a major overhaul of current securities rules. H.R. 2131, "The Capital Markets Deregulation and Liberalization Act of 1995," was introduced in late July by Rep. Jack Fields (R-TX), Chairman of the House Telecommunications and Finance Subcommittee of the House Committee on Commerce. Fields has said the bill "represents the most significant revision of federal regulation of the financial markets since the Great Depression." However, John Dingell (D-MI), the ranking Democrat on the Commerce Committee, is sharply critical of portions of the bill that he feels would reduce the effectiveness of the Securities and Exchange Commission in assuring that securities markets are kept "fair and honest." The legislation, as proposed, would expand the mission of the SEC to include assisting in capital raising; eliminate state securities laws (state regulators would enforce federal regulations); eliminate the Williams Act requirement for disclosure of beneficial ownership of an equity security when it results in beneficial ownership of more than 5% of the class (Section 13(d) of the Exchange Act) and strike rules in Section 13(e) relating to an issuer's repurchase of its own securities; eliminate suitability protection for institutional investors and limit broker-dealers' liability for investment decisions of large institutions; drop federally-set margin requirements for institutional investments, letting individual broker-dealers set their own limits; reduce the SEC from five to three commissioners; provide for privatization of the EDGAR system; and give the SEC broad exemptive authority to eliminate "outdated" rules. Hearings on the bill were scheduled to begin in September. The Society's Securities Law Committee is currently studying the legislation to determine a possible response. Copies of H.R. 2131 are available from Blanca Rosbach in the National Office at (212) 681-2010. The Corporate Secretary is published throughout the year as a service to members of the Society of Corporate Secretaries and Governance Professionals. Articles or statements appearing herein do not constitute legal opinion, advice or judgment and should not be relied upon as such. Inquiries regarding information contained in this newsletter should be directed to Geoff Loftus, at (212) 681-2000 or by e-mail: gloftus@governanceprofessionals.org. Inquiries regarding membership or publication orders should be addressed to: Membership Publications Deborah Fox Olga Holmes (212) 681-2014 (212) 681-2015
Society of Corporate Secretaries and Governance Professionals membership
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The Society will celebrate
its 50th Anniversary at our next National Conference in Seattle. A special Society
50th Anniversary Committee is hard at work to make the celebration a memorable
one. The Committee, headed by Gerald Burger with the able support of Archie
Bankston (the 50th National Conference chairman), Judy Cion, Jack Goetsch, Dick
Hays, David Smith and myself, is overseeing the preparation of both a videotape
and a book to commemorate a half-century of Society history.