Commissioner Paul S. Atkins, U.S. Securities and Exchange Commission
Thank you, Mr. Chairman. The topic before us is one that has long vexed many of our predecessors. It seems that at least once a decade, we engage in a significant review of the proxy rules — just look at what we did in 1976, 1982, 1992 and 1998. I had personal and intimate experience with the 1992 change, when I worked here previously. And now, during the first decade of the 21st century, this is already the second time we have engaged in an extensive review and discussion about the proxy rules.
The key question is how to address the competing problems of collective action versus the tyranny of the minority. How do we permit shareholders effectively to exercise their state corporate franchise rights without allowing a shareholder, who may have only a nominal economic interest, to hijack the agenda of all shareholders? We have tried to bridge this problem with Rule 14a-8, a rule that, while far from perfect, has at least created a framework for dealing with these problems.
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