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Purpose and Services
This page was last updated on January 23, 2001. Articles by Fund Democracy: Archives New Rules for Independent Directors Will Give Funds More Above-Board Boards, TheStreet.com (Jan. 17, 2001). The SEC adopted fund governance rules last week that will: increase in many cases the number of independent directors on fund boards and give them the authority to nominate new independent directors; require that counsel to independent directors also be independent; and require disclosure of how much directors invest in the funds they oversee and of conflicts of interest between directors and fund shareholders. On the whole, the SEC's proposals survived intense industry lobbying, and the result should be independent fund directors who are more effective advocates for shareholder interests. While the reforms won't turn independent fund directors into zealous shareholder advocates overnight, increasing their number and authority will give them more leverage. More importantly, independent directors who are nothing more than cronies of fund affiliates will be exposed by new disclosure requirements, resulting in a more above-board board. (View the full text of this article.) |