CCMR Calls For Increased Shareholder Rights
The US Committee on Capital Markets Regulation, an independent and bipartisan
group comprised of 22 leaders from the investor community, business, finance,
law, accounting and academia, last week issued its interim report, with recommendations
for changes in capital markets regulation based on the twin goals of enhancing
shareholders' rights while reducing excessive and overly burdensome regulation
and litigation.
The Committee outlined 32 specific recommendations in four key areas –
shareholder rights, the regulatory process, public and private enforcement and
Section 404 of the Sarbanes-Oxley Act of 2002 – to improve the regulatory
system, and give US capital markets the competitive boost necessary to respond
to the increasingly aggressive efforts of other countries to attract equity
capital markets. “Maximizing the competitiveness of US capital markets is critical to
ensuring economic growth, job creation, low cost of capital, innovation, entrepreneurship
and a strong tax base in key areas of the country,” explained Glenn Hubbard,
Dean of Columbia Business School and co-chairman of the Committee. He continued: “While US capital markets historically have been the deepest, most liquid
financial and lowest cost markets anywhere, the world is vastly different today.
There are several viable markets for raising capital, and many companies now
are using cost-benefit analysis – including the potential cost of litigation
and the complexity of regulation – to focus on the competitive differences
among the markets." .
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