‘‘(7) DISCLOSURES BY INSTITUTIONAL INVEST-
MENT MANAGERS IN CONNECTION WITH PROXY AD-
VISORY FIRMS.— 
‘‘(A) IN GENERAL.—Every institutional in-
vestment manager which uses the mails, or any 
means or instrumentality of interstate com-
merce in the course of its business as an insti-
tutional investment manager, which engages a 
proxy advisory firm, and which exercises voting 
power with respect to accounts holding equity 
securities of a class described in subsection 
(d)(1) or otherwise becomes or is deemed to be-
come a beneficial owner of any security of a 
class described in subsection (d)(1) upon the 
purchase or sale of a security-based swap that 
the Commission may define by rule, shall file an 
annual report with the Commission con-
taining— 
‘‘(i) an explanation of how the institu-
tional investment manager voted with re-
spect to each shareholder proposal; 
‘‘(ii) the percentage of votes cast on 
shareholder proposals that were consistent 
with proxy advisory firm recommendations, 
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for each proxy advisory firm retained by 
the institutional investment manager; 
‘‘(iii) an explanation of— 
‘‘(I) how the institutional invest-
ment manager took into consideration 
proxy advisory firm recommendations 
in making voting decisions, including 
the degree to which the institutional 
investment manager used those rec-
ommendations in making voting deci-
sions; 
‘‘(II) how often the institutional 
investment manager voted consistent 
with a recommendation made by a 
proxy advisory firm, expressed as a 
percentage; 
‘‘(III) how such votes are rec-
onciled with the fiduciary duty of the 
institutional investment manager to 
vote in the best economic interests of 
shareholders; 
‘‘(IV) how frequently votes were 
changed when an error occurred or 
due to new information from issuers; 
and 
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‘‘(V) the degree to which invest-
ment professionals of the institutional 
investment manager were involved in 
proxy voting decisions; and 
‘‘(iv) a certification that the voting de-
cisions of the institutional investment man-
ager were based solely on the best eco-
nomic interest of the shareholders on be-
half of whom the institutional investment 
manager holds shares. 
‘‘(B) REQUIREMENTS FOR LARGER INSTI-
TUTIONAL INVESTMENT MANAGERS.—Every in-
stitutional investment manager described in 
subparagraph (A) that has an aggregate fair 
market value on the last trading day in any of 
the preceding twelve months of at least 
$100,000,000,000 shall— 
‘‘(i) in any materials provided to cus-
tomers and related to customers voting 
their shares, clarify that shareholders are 
not required to vote on every proposal; 
‘‘(ii) with respect to each shareholder 
proposal for which the institutional invest-
ment manager votes (other than votes con-
sistent with the recommendation of a 
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board of directors composed of a majority 
of independent directors) perform an eco-
nomic analysis before making such vote, to 
determine that the vote is in the best eco-
nomic interest of the shareholders on be-
half of whom the institutional investment 
manager holds shares; and 
‘‘(iii) include each economic analysis 
required under clause (ii) in the annual re-
port required under subparagraph (A). 
‘‘(C) 
CERTIFICATION
REQUIREMENT.— 
Each report required under this paragraph 
shall be certified by the chief executive officer 
and chief financial officer of the institutional 
investment manager. 
‘‘(D) BEST
ECONOMIC
INTEREST
DE-
FINED.—In this paragraph, the term ‘best eco-
nomic interest’ means decisions that seek to 
maximize investment returns over a time hori-
zon consistent with the investment objectives 
and risk management profile of the fund in 
which shareholders are invested.’’. 
(b) PROXY ADVISORY FIRM DEFINED.—Section 3(a) 
of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) 
is amended by adding at the end the following: 
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‘‘(82) PROXY
ADVISORY
FIRM.—The term 
‘proxy advisory firm’— 
‘‘(A) means any person who is primarily 
engaged in the business of providing proxy vot-
ing advice, research, analysis, ratings, or rec-
ommendations to clients, which conduct con-
stitutes a solicitation within the meaning of sec-
tion 14; and 
‘‘(B) does not include any person that is 
exempt under law or regulation from the re-
quirements otherwise applicable to persons en-
gaged in such a solicitation.’’. 
Æ 
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