Stop Woke Investing Act
1/30/2025, 6:23 AMSummary of Bill HR 52
Bill 119 HR 52, also known as the "Shareholder Proposal Rule Amendment Act," is a piece of legislation that aims to require the Securities and Exchange Commission (SEC) to make changes to a rule regarding shareholder proposals. The bill also includes provisions for other purposes related to shareholder rights and corporate governance.The main focus of the bill is on amending the SEC rule that governs the process by which shareholders can submit proposals for consideration at a company's annual meeting. The bill seeks to make it easier for shareholders to have their proposals included in the company's proxy materials, which are distributed to all shareholders before the annual meeting.
In addition to the changes to the shareholder proposal rule, the bill also includes provisions aimed at enhancing transparency and accountability in corporate governance. This includes requirements for companies to disclose more information about their executive compensation practices and board diversity. Overall, Bill 119 HR 52 is aimed at empowering shareholders and promoting good corporate governance practices. It seeks to ensure that shareholders have a voice in the decision-making processes of the companies in which they invest, and that companies are held accountable for their actions.
Congressional Summary of HR 52
Stop Woke Investing Act
This bill requires the Securities and Exchange Commission (SEC) to amend regulations to limit the inclusion of shareholder proposals in proxy statements. A proxy statement is provided to shareholders prior to a public company holding a shareholder meeting and contains information relevant to a shareholder vote. Under current SEC rules, certain qualifying shareholder proposals must be included on a company's proxy statement, including proposals that raise significant social policy issues.
Under the bill, a shareholder proposal must have a material effect on the financial performance of the company to be included in a proxy statement. The bill also establishes a cap on the number of shareholder proposals required to be included in a shareholder meeting, depending on the size and type of the company. In addition, a proposal submitted by a member of the board of directors is prohibited from inclusion as a shareholder proposal.
