US Equity Market Reforms
The Committee on Capital Markets Regulation today released a lengthy report recommending a series of regulatory and legal reforms and marketplace reforms designed to (as these things always seem to do) enhance American competitiveness. In the shareholder rights section, there's a proposal that exchanges adopt listing requirements that listed firms with staggered boards obtain shareholder approval of poison pills. (Actually, the first recommendation is that "Delaware should do this".) Why should we expect that exchanges, acting independently, will adopt reforms that incumbent magament believes are inimical to their own interests? If memory serves, the NYSE long had a rule prohibiting the listing of shares in companies with dual-class voting. Then, when a big fish decided that it wanted to have dual-class voting and threatened to list on another exchange, the NYSE relented. (The SEC tried to limit the dual-class structure by adopting a rule 19c-4, lost a case over its ...