I 

111TH CONGRESS 

1ST SESSION H. R. 3351 

To amend the Securities Exchange Act of 1934 to provide shareholders 

with a non-binding vote on executive compensation. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 27, 2009 

Ms. KILROY introduced the following bill; which was referred to the Committee 

on Financial Services 

A BILL 

To amend the Securities Exchange Act of 1934 to provide 

shareholders with a non-binding vote on executive compensation. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Proxy Voting Trans5 parency Act of 2009’’. 

6 SEC. 2. SHAREHOLDER VOTE ON EXECUTIVE COMPENSA7 TION DISCLOSURES. 

8 Section 14 of the Securities Exchange Act of 1934 

9 (15 U.S.C. 78n) is amended by adding at the end the fol10 lowing new subsection: 


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1 ‘‘(i) ANNUAL SHAREHOLDER APPROVAL OF EXECU2 TIVE COMPENSATION.— 

3 ‘‘(1) ANNUAL VOTE.—Any proxy or consent or 

4 authorization for an annual meeting of the share5 holders (or a special meeting in lieu of the annual 

6 meeting) occurring on or after the date that is 6 

7 months after the date on which final rules are issued 

8 under paragraph (4), shall provide for a separate 

9 shareholder vote to approve the compensation of ex10 ecutives as disclosed pursuant to the Commission’s 

11 compensation disclosure rules (which disclosure shall 

12 include the compensation committee report, the com13 pensation discussion and analysis, the compensation 

14 tables, and any related materials). The shareholder 

15 vote shall not be binding on the corporation or the 

16 board of directors and shall not be construed as 

17 overruling a decision by such board, nor to create or 

18 imply any additional fiduciary duty by such board, 

19 nor shall such vote be construed to restrict or limit 

20 the ability of shareholders to make proposals for in21 clusion in such proxy materials related to executive 

22 compensation. 

23 ‘‘(2) SHAREHOLDER APPROVAL OF GOLDEN

24 PARACHUTE COMPENSATION.— 


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1 ‘‘(A) DISCLOSURE.—In any proxy or con2 sent solicitation material for an annual meeting 

3 of the shareholders (or a special meeting in lieu 

4 of the annual meeting) occurring on or after 

5 the date that is 6 months after the date on 

6 which final rules are issued under paragraph 

7 (4), that concerns an acquisition, merger, con8 solidation, or proposed sale or other disposition 

9 of all or substantially all the assets of an issuer, 

10 the person making such solicitation shall dis11 close in the proxy or consent solicitation mate12 rial, in a clear and simple tabular form in ac13 cordance with regulations to be promulgated by 

14 the Commission, any agreements or under15 standings that such person has with any prin16 cipal executive officers of such issuer (or of the 

17 acquiring issuer, if such issuer is not the ac18 quiring issuer) concerning any type of com19 pensation (whether present, deferred, or contin20 gent) that is based on or otherwise relates to 

21 the acquisition, merger, consolidation, sale, or 

22 other disposition of all or substantially all of 

23 the assets of the issuer that have not been sub24 ject to a shareholder vote under paragraph (1), 

25 and the aggregate total of all such compensaVerDate Nov 24 2008 01:55 Jul 28, 2009 Jkt 079200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3351.IH H3351

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1 tion that may (and the conditions upon which 

2 it may) be paid or become payable to or on be3 half of such executive officer. 

4 ‘‘(B) SHAREHOLDER APPROVAL.—Any 

5 proxy or consent or authorization relating to 

6 the proxy or consent solicitation material con7 taining the disclosure required by subparagraph 

8 (A) shall provide for a separate shareholder 

9 vote to approve such agreements or under10 standings and compensation as disclosed. A 

11 vote by the shareholders shall not be binding on 

12 the corporation or the board of directors of the 

13 issuer or the person making the solicitation and 

14 shall not be construed as overruling a decision 

15 by such board, nor to create or imply any addi16 tional fiduciary duty by such board, nor shall 

17 such vote be construed to restrict or limit the 

18 ability of shareholders to make proposals for in19 clusion in such proxy materials related to execu20 tive compensation. 

21 ‘‘(3) DISCLOSURE OF VOTES.—Every institu22 tional investment manager subject to section 13(f) 

23 shall report at least annually how it voted on any 

24 shareholder vote unless such vote is otherwise reVerDate Nov 24 2008 01:55 Jul 28, 2009 Jkt 079200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3351.IH H3351

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1 quired to be reported publicly by rule or regulation 

2 of the Commission. 

3 ‘‘(4) RULEMAKING.—Not later than 6 months 

4 after the date of enactment of the Investor Voting 

5 Fairness Act of 2009, the Commission shall issue 

6 rules and regulations to implement this subsection.’’. 

Æ 


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