September 18, 2007
Dear U.S. Securities and Exchange Commission:
If you have any interest in exactly who I am you are invited to look at www.votepal.com. You will find that I am both an active individual shareholder for the last 20 years, and a leader of general shareholders with a particular focus on employee shareholders.. In fact, some of the positive changes over the last two decades can be directly traced to the work I have been involved in. While the URL above does not contain any data relating to my involvement in litigation representing hundreds of thousands of shareholders, I will be happy to provide this information to you. In working with employee shareholders at Alaska Air Group, Inc. I have run as a candidate for election to the board of directors. I have been directly involved in breaking new ground in using the Internet to conduct proxy contests over the last five years. These experiences give me a unique set of perspectives about how the SEC works and how it fails. The SEC?s proposed rules File Number S7-16-07 are an abomination and present an enormous danger to the economy of this country.
I oppose any action by the Securities and Exchange Commission (SEC) to weaken the rights of Americans to present resolutions for votes by the millions of investors like me who own stock in companies. (This in reference to SEC File Number S7-16-07.)
I urge the SEC and, if necessary, Congress to stop any initiatives that would limit the rights of shareholders to sponsor proxy resolutions or prevent investors from nominating members of corporate boards. My bottom line here is simple: I believe that it would be better for the SEC to take no action on their shareholder resolution initiatives than it would be for the Commission to destroy the rights of shareholders.
I am worried that the SEC is on the wrong track. In my view, we need more shareholder involvement in American corporations -- not less. I strongly support the rights of shareholders to use the resolution process to encourage responsible action by often troubled companies that engage in runaway CEO compensation, poor corporate governance, a history of polluting/inaction on climate change, racial/gender discrimination and other problem behaviors.
These problems often end up costing shareholders like me a lot of money in the long run as a result of lawsuits, clean-ups, damaged company reputations and other outcomes that drive stock prices down. The best remedy is when the companies in question are encouraged by shareholders to get on the right path and start acting as well governed, responsible corporate citizens. These are not companies that the SEC should be protecting from shareholders who are understandably concerned about what are often very serious risks to our long-term investments. These companies -- and, in fact, all companies -- need more scrutiny and feedback, not less.
I also believe that the real owners of America's companies should be able to help nominate corporate board members. This is a process that could use more openness and accountability. Investors have a duty to take their ownership role seriously. At the same time, the companies have a responsibility to investors: They should be expected to listen to their shareowners -- rather than working to limit the rights of shareholders to raise important issues, including the selection of corporate directors.
The SEC should focus on putting the interests of investors first. I urge Congress to monitor this situation and get involved to ensure that, above all other things, the SEC is the servant of the American public and its best interests. Do not allow the voice of investors to be silenced!
Thank you for your attention to my comments.
Sincerely,
Richard Foley