I 
111TH CONGRESS 
1ST SESSION H. R. 3269 
To amend the Securities Exchange Act of 1934 to provide shareholders 
with an advisory vote on executive compensation and to prevent perverse 
incentives in the compensation practices of financial institutions. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 21, 2009 
Mr. FRANK of Massachusetts (for himself, Mr. PETERS, Ms. KILROY, Mr. 
WATT, Mr. CAPUANO, Mr. AL GREEN of Texas, Mr. SHERMAN, Mr. CAR-
SON of Indiana, Mr. GUTIERREZ, Mr. ELLISON, and Mr. HINOJOSA) in-
troduced the following bill; which was referred to the Committee on Fi-
nancial Services 
A BILL 
To amend the Securities Exchange Act of 1934 to provide 
shareholders with an advisory vote on executive com-
pensation and to prevent perverse incentives in the com-
pensation practices of financial institutions. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Corporate and Finan-
cial Institution Compensation Fairness Act of 2009’’. 
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SEC. 2. SHAREHOLDER VOTE ON EXECUTIVE COMPENSA-
TION DISCLOSURES. 
Section 14 of the Securities Exchange Act of 1934 
(15 U.S.C. 78n) is amended by adding at the end the fol-
lowing new subsection: 
‘‘(i) ANNUAL SHAREHOLDER APPROVAL OF EXECU-
TIVE COMPENSATION.— 
‘‘(1) ANNUAL VOTE.—Any proxy or consent or 
authorization for an annual meeting of the share-
holders (or a special meeting in lieu of the annual 
meeting) occurring on or after the date that is 6 
months after the date on which final rules are issued 
under paragraph (3), shall provide for a separate 
shareholder vote to approve the compensation of ex-
ecutives as disclosed pursuant to the Commission’s 
compensation disclosure rules (which disclosure shall 
include the compensation committee report, the com-
pensation discussion and analysis, the compensation 
tables, and any related materials). The shareholder 
vote shall not be binding on the corporation or the 
board of directors and shall not be construed as 
overruling a decision by such board, nor to create or 
imply any additional fiduciary duty by such board, 
nor shall such vote be construed to restrict or limit 
the ability of shareholders to make proposals for in-
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clusion in such proxy materials related to executive 
compensation. 
‘‘(2) SHAREHOLDER
APPROVAL
OF
GOLDEN 
PARACHUTE COMPENSATION.— 
‘‘(A) DISCLOSURE.—In any proxy or con-
sent solicitation material for an annual meeting 
of the shareholders (or a special meeting in lieu 
of the annual meeting) occurring on or after 
the date that is 6 months after the date on 
which final rules are issued under paragraph 
(3), that concerns an acquisition, merger, con-
solidation, or proposed sale or other disposition 
of all or substantially all the assets of an issuer, 
the person making such solicitation shall dis-
close in the proxy or consent solicitation mate-
rial, in a clear and simple tabular form in ac-
cordance with regulations to be promulgated by 
the Commission, any agreements or under-
standings that such person has with any prin-
cipal executive officers of such issuer (or of the 
acquiring issuer, if such issuer is not the ac-
quiring issuer) concerning any type of com-
pensation (whether present, deferred, or contin-
gent) that is based on or otherwise relates to 
the acquisition, merger, consolidation, sale, or 
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other disposition of all or substantially all of 
the assets of the issuer that have not been sub-
ject to a shareholder vote under paragraph (1), 
and the aggregate total of all such compensa-
tion that may (and the conditions upon which 
it may) be paid or become payable to or on be-
half of such executive officer. 
‘‘(B) 
SHAREHOLDER
APPROVAL.—Any 
proxy or consent or authorization relating to 
the proxy or consent solicitation material con-
taining the disclosure required by subparagraph 
(A) shall provide for a separate shareholder 
vote to approve such agreements or under-
standings and compensation as disclosed. A 
vote by the shareholders shall not be binding on 
the corporation or the board of directors of the 
issuer or the person making the solicitation and 
shall not be construed as overruling a decision 
by such board, nor to create or imply any addi-
tional fiduciary duty by such board, nor shall 
such vote be construed to restrict or limit the 
ability of shareholders to make proposals for in-
clusion in such proxy materials related to execu-
tive compensation. 
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‘‘(3) RULEMAKING.—Not later than 6 months 
after the date of the enactment of the Corporate and 
Financial Institution Compensation Fairness Act of 
2009, the Commission shall issue rules and regula-
tions to implement this subsection.’’. 
SEC. 3. COMPENSATION COMMITTEE INDEPENDENCE. 
(a) STANDARDS RELATING TO COMPENSATION COM-
MITTEES.—The Securities Exchange Act of 1934 (15 
U.S.C. 78f) is amended by inserting after section 10A the 
following new section: 
‘‘SEC. 10B. STANDARDS RELATING TO COMPENSATION COM-
MITTEES. 
‘‘(a) COMMISSION RULES.— 
‘‘(1) IN
GENERAL.—Effective not later than 
270 days after the date of enactment of the Cor-
porate and Financial Institution Compensation Fair-
ness Act of 2009, the Commission shall, by rule, di-
rect the national securities exchanges and national 
securities associations to prohibit the listing of any 
security of an issuer that is not in compliance with 
the requirements of any portion of subsections (b) 
through (f). 
‘‘(2) OPPORTUNITY TO CURE DEFECTS.—The 
rules of the Commission under paragraph (1) shall 
provide for appropriate procedures for an issuer to 
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