Jun. 25, 2023
The proposal in section 5 of the background in file number S7-06-22, which deems holders of "certain cash settled derivative securities", should not be allowed to pass as this entitles non stockholders voting rights in company matters. This dilutes the voting power of actual shareholders, and since derivatives are often issued by market participants other than the company, the shareholders and company owners would have no way to limit the extent of this dilution. In a worst case scenario, derivatives totaling more than 100% of the underlying security may be issued for the sole purpose of guaranteeing a controlling stake in all voting matters. If this is allowed to pass, corporate governance will no longer be in the control of shareholders but instead will be controlled by major market participants. -Ethan Mullins