Votermedia Finance Blog

January 29, 2010

Investor Education on Proxy Voting

Filed under: Uncategorized — Tags: — Mark Latham @ 2:08 pm

Like my previous post on January 23, this is an update for individual investors on how I am representing them on the SEC Investor Advisory Committee. I submitted the report below to the Investor Education subcommittee earlier this month:

TO: SEC Investor Advisory Committee’s Investor Education Subcommittee
FROM: Mark Latham
RE: Recommendations for investor education on proxy voting
Date: January 7, 2010

1. Proxy voting is important.

This almost goes without saying, but deserves emphasis because it is so fundamental. Voting is the primary means for holding corporate directors and management accountable to shareowners. It is the cornerstone of good corporate governance, essential for the performance of our economy.

2. Proxy voting by retail investors is important.

It’s important in principle, and we should make it important in practice.


January 23, 2010

Voter Funded Investor Education Proposal

Filed under: Uncategorized — Tags: — Mark Latham @ 10:36 pm

Since I represent individual investors on the SEC Investor Advisory Committee (SECIAC), I will give updates in this blog about what I am doing to fulfill that mission. The proposal below is one such project. I drafted it for consideration by the Investor Education subcommittee, hoping to see it forwarded to the full SECIAC and from there submitted to the SEC. Unfortunately that didn’t happen, as I explain below after the proposal text:

Voter Funded Investor Education Proposal – draft 20091130

TO: Securities and Exchange Commission
FROM: SEC Investor Advisory Committee
RE: Letting individual investors vote to allocate some education program funding

We recommend that the Commission have its Office of Investor Education and Advocacy (OIEA) explore the potential for letting individual investors vote to allocate some funding for investor education programs. If the OIEA determines that such an approach could play an effective role in advancing investor education, it could then implement a pilot program of limited scale.


December 28, 2009

On2 Shareowners Rebellion

Filed under: Uncategorized — Tags: , — Mark Latham @ 4:09 pm

In the past three days I’ve received emails and comments (here, here, here & here) from shareowners of On2 Technologies – see the Yahoo Finance On2 message board, especially this post. Here is my response:

Thank you for contacting me.

Your horse has escaped, and you are chasing it through the forest. You want me to help chase your horse. I’m not good at chasing horses. I’m good at locking barn doors, and that’s what I’m doing. If I stop doing that to chase your horse instead, I won’t be much help at catching it, and meanwhile more horses will be escaping. But I do wish you success in catching your horse!


November 6, 2009

Giving talks at Stanford & Berkeley

Filed under: Uncategorized — Tags: , , , — Mark Latham @ 9:11 pm

I’ve recently scheduled to give these three talks:

Nov. 16 at Stanford Law School’s Rock Center for Corporate Governance, mainly on the paper “Proxy Voting Brand Competition”, my work on the SEC Investor Advisory Committee, and ProxyDemocracy.

Nov. 17 at U C Berkeley’s Institute of Governmental Studies, mainly on the paper “Global Voter Media Platform” and

Dec. 10 at the 2009 British Columbia Pension Forum, mainly on the paper “Proxy Voting Brand Competition”, my work on the SEC Investor Advisory Committee, and ProxyDemocracy.

More info on the talks at The papers are available at

October 27, 2009

SECIAC meetings: videos & minutes

Filed under: Uncategorized — Tags: — Mark Latham @ 9:21 am

The SEC Investor Advisory Committee web page has links to videos and minutes of our meetings (+ other info). Videos for the 2009-07-27 meeting and the 2009-10-05 meeting have been posted. Minutes for 2009-07-27 are posted, but not for 2009-10-05 yet.

If you’d like to see where on each video I spoke up, here are the times and summaries of what I said:

2009-07-27 video 1 (morning):

0:35:25 I introduced myself — my background and some views on investor education.

1:52:34 I suggested consideration of an investor education pilot program using a competitive voting system to allocate public funds.

2009-07-27 video 2 (afternoon):

0:15:00 I agreed with Mr. Salisbury that our advice should take into account other existing and proposed investor education initiatives.

0:41:12 I described new tools for individual investors to vote by copying the votes of institutional investors, being developed by ProxyDemocracy, a non-profit group at which I serve as a director. I noted that newcomer MoxyVote plans to offer something similar.

0:57:45 I suggested that shareowner resolutions relating to auditor selection should not be deemed ‘ordinary business’ and thus excludable from the proxy. I noted a parallel with director elections, which are now being considered fair game for shareowner involvement.

2009-10-05 video 1 (morning):

2:52:40 I suggested that our ability to submit both majority and minority views as advice to the SEC makes the proposed recusal policy less necessary.

October 2, 2009

SECIAC Members, Subcommittees & Constituencies

Filed under: Uncategorized — Tags: — Mark Latham @ 3:55 pm

Here is a list of the SEC Investor Advisory Committee members, our subcommittee assignments, affiliations, and constituencies that (according to SEC staff) we represent:

FirstName LastName Education Purchaser Owner Title Organization Representing
Jeff Brown 1 1 1 Senior VP, Office of Legislative & Regulatory Affairs The Charles Schwab Corporation From a regulatory and customer-service perspective, providers of tools to retail investors who elect to make their own investment decisions
Mercer Bullard
Founder Fund Democracy Individual mutual fund investors
Hye-Won Choi

1 Senior VP & Head of Corp. Governance TIAA-CREF Those involved in retirement planning for investors who work in academic, medical, cultural and research institutions
Stephen Davis

Chair Executive Director, Millstein Center for Corporate Governance Yale University School of Management International institutional investors
Abe Friedman
1 Global Head of Corporate Governance & Responsible Investment BlackRock Very large global institutional investors
Mac Hisey
President AARP Financial Inc. Senior investors
Mellody Hobson 1

President Ariel Investments Smaller, as well as minority-owned, institutional investors
Fred J. Joseph 1 1
Colorado Securities Commissioner & Acting State Bank Commissioner Colorado Department of Regulatory Agencies State securities regulators
Adam Kanzer

1 Managing Director & General Counsel Domini Social Investments Social investors
Mark Latham 1 Founder Individual investors, particularly with respect to their role in corporate governance
Barbara Roper
Director, Investor Protection Consumer Federation of America Individual investors, with a particular focus on investor protection
Dallas Salisbury Chair 1
President and CEO Employee Benefit Research Institute Individual investors, especially with respect to employee retirement issues
Kurt Schacht
Managing Director CFA Institute Investment professionals
Damon Silvers

1 Associate General Counsel AFL-CIO Institutional labor investors
Kurt P. Stocker 1
1 Member of the Board NYSE Individual investors
Ann Yerger

1 Executive Director Council of Institutional Investors Pension funds and those who depend upon them

Total #: 16 5 7 9

September 22, 2009

SECIAC Meeting Notice for October 5, 2009

Filed under: Uncategorized — Tags: — Mark Latham @ 4:41 pm

Today I noticed that the public announcement of our next meeting has been posted on the SEC Investor Advisory Committee spotlight page.

It starts at 9 a.m. EST, is open to the public (and will be webcast) except for 2 hours when we’re in subcommittees (probably noon to 2 pm). It should end about 5 pm.

“The agenda for the meeting includes: (i) a presentation by SEC staff of potential Commission initiatives; (ii) description of the composition and purpose of the Committee’s subcommittees; (iii) consideration of a Committee recusal policy; (iv) reports from the Committee’s subcommittees; and (v) discussion of next steps for the Committee, including regarding SEC resources.
DATES: Written statements should be received on or before September 28, 2009”

Instructions for submitting statements are in the announcement.

September 15, 2009

SEC Investor Advisory Committee creates 3 subcommittees

Filed under: Uncategorized — Tags: — Mark Latham @ 2:19 pm

From today’s SEC press release:

An Investor Education Subcommittee chaired by Dallas Salisbury (President and CEO, Employee Benefit Research Institute) plans to focus on matters related to financial literacy, the efficacy of layered educational resources that may permit investors to access information at varying levels of detail reflecting their needs, the ways that issuers and boards of directors communicate with investors, and the types of technology that can be utilized for education.

An Investor as Purchaser Subcommittee chaired by Mercer Bullard (Founder and President of Fund Democracy, Inc. and Associate Professor of Law, University of Mississippi School of Law) expects to examine the needs of investors when they purchase specific products (mutual funds, hedge funds, money market funds) and services (brokerage, investment advisory, and financial planning). This subcommittee also will consider the fiduciary duty owed to investors by those who provide investment advice, as well as issues related to pre-sale and other disclosure, intermediary fees and compensation practices, arbitration, and technology.

An Investor as Owner Subcommittee chaired by Stephen Davis (Executive Director of Yale School for Management’s Millstein Center for Corporate Governance, and board member of Hermes Equity Ownership Service) intends to review proxy solicitation and disclosure issues, proxy voting and process (including the role of proxy advisory firms), majority voting, Regulation FD, executive compensation practices, the responsibilities of shareholders, international issues, and technology related to shareholder communications and voting.

The SEC’s Investor Advisory Committee plans to hold its next meeting in early October.

A new Web page with more information about the work of the SEC’s Investor Advisory Committee is available at investoradvisorycommittee.shtml.

I’ve volunteered for Investor Education and Investor as Owner.

August 7, 2009

Vote to allocate investor education budget

Filed under: Uncategorized — Tags: , , , — Mark Latham @ 7:12 pm

I write two blogs, and their topics overlap somewhat. (The other is VoterMedia Democracy Blog.) This post is an example of that overlap.

Both blogs relate to the website, which is a political reform project that focuses on the economics of information that flows to voters, in corporations and in democracies.

I propose that voters in each community (corporation, city, country, labor union etc) vote to allocate a budget among competing information providers. These would be something like proxy advisors for corporate shareowners, and political media & think tanks for democracies. For smaller voter communities like student unions, the advisor/info role would often be filled by bloggers.

I first proposed this for corporations in 1988, and published it in 1997 (and later) — see I submitted it as a shareowner proposal many times, some of which are listed at Management of course opposed it, but I was disappointed in the lack of support from institutional investors.

So I expanded my scope to democracies, wrote some papers about how to apply the idea there, and sponsored several test implementations in the last few years, especially at the University of British Columbia’s student union and in Vancouver city politics. I explain the idea and test results in the paper Global Voter Media Platform, along with a plan for the website which we are now building. See also our FAQ page.

Thinking about the issues we are facing in the SEC Investor Advisory Committee, I found myself reacting to the problems of disclosure requirements, especially disclosure to retail investors, e.g. when buying mutual funds. It’s so hard to control the behavior of people who make money from investors. But a well-designed investor information/education system should be able to effectively empower individuals to make better investment decisions.

The economics of such an information system are similar to the economics of voter information systems. There’s a large shared public interest component of such a system, which private markets do not fulfill very well. But allocation and oversight of public funding is often inefficient and ineffective, so we end up with poor information systems. The voter funding allocation system I’ve proposed could be applied to investor education too.

So I recently added a page for that to our new website — see For now, the whole website is in public test mode. There’s no funding yet. Anyone can vote, with or without a login. So far I’ve just told a few colleagues about this new page, so the votes are too heavily weighted toward Proxy Democracy (where I’m on the board). Feel free to vote and tell others, to balance this out! (Also see example pages for Vancouver and UBC.)

July 21, 2009

SECIAC July 27 meeting agenda

Filed under: Uncategorized — Tags: — Mark Latham @ 9:22 am

The first meeting of the SEC Investor Advisory Committee is next Monday. Here’s an excerpt from their Notice of Meeting, which is linked from the SECIAC Spotlight page:

The Securities and Exchange Commission Investor Advisory Committee is providing notice that it will hold a public meeting on Monday, July 27, 2009, in the Auditorium, Room L-002, at the Commission’s main offices, 100 F Street, NE, Washington, DC.  The meeting will begin at 10:00 am (EST) and will be open to the public. The meeting will be webcast on the Commission’s Web site at

Here’s the latest agenda I’ve received (as of 2009-07-13):

Open Meeting of the Securities and Exchange Commission
Investor Advisory Committee

Location:    SEC Headquarters
Auditorium, Room L002
Washington, D.C.

Date:        Monday, July 27, 2009

Time:        10:00 A.M.


9:00 – 10:00 a.m.         Informal Breakfast

10:00 – 10:30 a.m.    Opening Remarks, Commissioner Luis A. Aguilar; Opening Remarks, Committee Co-Chairs Richard (Mac) Hisey and Hye-Won Choi

10:30 – 10:50 a.m.    Introduction of Committee Members and Supporting Staff

10:50 – 12:00 p.m.    Committee Agenda and Organization

12:00 – 1:00 p.m.    Lunch and Discussion of Administrative Issues

1:00 – 3:00 p.m.    Investor Views of Possible Refinements to the Disclosure Regime

3:00 – 3:45 p.m.    Next Steps:  Confirm Dates for Future Meetings and Discuss Prioritization of Issues

3:45 p.m.    Adjournment

I’ll be in DC until late afternoon Tuesday July 28, and still have some times available to meet people from 12:30 to about 3 pm that day (email mark[at]

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