,,ii  #aae? ,,congress  #b;d ,session   
,s4 #cfad  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,novemb] #ac1 #bjah    
,mr4 ,re$ 7= himself1 ,mr4 ,p]due1 ,ms4 
,heitkamp1 ,mr4 ,tillis1 ,mr4 ,jones1 & 
,mr4 ,k5n$y7 introduc$ ! foll[+ bill2   
:i* 0 read twice & ref]r$ to !          
,committee on ,bank+1 ,h\s+1 & ,urban   
,affairs  ,a ,,bill  ,to am5d !         
,inve/m5t ,advis]s ,act ( #aidj to      
require proxy advisory firms to regi/] z
 inve/m5t advis]s "u t ,act1 & = o!r    
purposes4  #a4 ,%ort title  ,?is ,act   
may be cit$ z ! ,corporate ,gov]nance   
,fairness ,act4  #b4 ,proxy advisory    
firms  ,! ,inve/m5t ,advis]s ,act (     
#aidj 7#ae ,u4,s4,c4 #hj;b-#a et seq47  
is am5d$-- 7#a7 9 section #bjb7;a7 7#ae 
,u4,s4,c4 #hj;b-#b7;a77--  7,a7 9       
p>agraph 7#aa7-- 7i7 9 ! matt] prec$+   
subp>agraph 7,a71 by ins]t+ 1 & includes
 a proxy advisory firm aft] promulgates 
analyses or reports conc]n+ securities2 
&  7ii7 9 subp>agraph 7,f71 by /rik+ on 
behalf ( o!rs22 & ins]t+ on behalf (    

o!rs or acts z a proxy advisory firm22  
7,b7 by r$esignat+ ! second p>agraph    
7#bi7 z p>agraph 7#ca72 &  7,c7 by add+ 
at ! end ! foll[+3  7#cb7 7,a7 ,! t]m   
proxy advisory firm--  7i7 subject to   
clause 7ii71 means any p]son t is engag$
 9 ! bus9ess ( provid+ proxy vot+       
rese>*1 analysis1 rat+s1 or             
recomm5dations to inve/ors 9 issu]s by  
means ( writt5 or oral /atem5ts t are   
reasonably design$ to meet ! objectives 
or ne$s ( specific cli5ts1 inve/ors1 or 
_! acc\nts1 includ+ proxy vot+ rese>*1  
analysis1 rat+s1 or recomm5dations t are
 tailor$ to or reflect p>ticul> proxy   
vot+ guidel9es develop$ or select$ by   
inve/ors2 &  7ii7 does n include any    
p]son describ$ 9 clause 7i7 t1 toge!r ) 
! p>5t1 subsidi>ies1 & affiliates ( !   
p]son1 receives on a consolidat$ basis 9
 a fiscal ye> gross receipts f ! cli5ts 
( ! p]son 9 an am\nt t is n m ?an       
#e1jjj1jjj1 z adju/$ annually by !      
,commission to reflect ! p]c5tage *ange 
= ! previ\s cal5d> ye> 9 ! gross dome/ic

 product ( ! ,unit$ ,/ates1 z calculat$ 
by ! ,bureau ( ,economic ,analysis ( !  
,dep>tm5t ( ,comm]ce1 except t a p]son  
describ$ 9 ?is clause may *oose to be   
consid]$ a proxy advisory firm = !      
purposes ( ?is ,act4  7,b7 ,not)/&+ any 
o!r provision ( law or regulation-- 7i7 
= ! purposes ( ?is ,act1 a proxy        
advisory firm may n be consid]$ to be   
exclud$ f ! def9ition ( ! t]m inve/m5t  
advis] "u p>agraph 7#aa7 because ( !    
application ( subp>agraph 7,d7 ( t      
p>agraph2 &  7ii7 only ! ,commission1 "u
 subp>agraph 7,h7 ( p>agraph 7#aa71 may 
designate a proxy advisory firm z a     
p]son describ$ 9 t subp>agraph1 except t
 ! ,commission may n make su* a         
designation if ! proxy advisory firm is 
describ$ 9 any ( p>agraphs 7#a7 ?r\gh   
7#i7 ( section #bjc7;e74  2  7#b7 9     
section #bjc 7#ae ,u4,s4,c4 #hj;b-#c71  
by add+ at ! end ! foll[+3  7o7 ,rule ( 
con/ruction ,no?+ 9 subsections 7b7     
?r\gh 7n7 may be con/ru$ to exempt a    
proxy advisory firm f ! application ( ! 

provisions ( subsection 7a74  2  7#c7 9 
section #bjc;,a7a77#a7 7#ae ,u4,s4,c4   
#hj;b-#c;a7a77#a77-- 7,a7 9 subp>agraph 
7,a71 by /rik+ or at ! end2  7,b7 9     
subp>agraph 7,b71 by /rik+ ! p]iod at ! 
end & ins]t+ 2 or2 &  7,c7 by add+ at ! 
end ! foll[+3  7,c7 is a proxy advisory 
firm4  2  7#d7 9 section #bjd 7#ae      
,u4,s4,c4 #hj;b-#d7--  7,a7 by          
r$esignat+ ! second subsection 7d7      
7relat+ to records ( p]sons ) cu/ody or 
use7 z subsection 7e72 &  7,b7 by add+  
at ! end ! foll[+3  7f7 ,exam9ation (   
records ( proxy advisory firms  7#a7    
,p]iodic & special exam9ations ,!       
,commission--  7,a7 %all-- 7i7 beg9n+ n 
lat] ?an #a ye> aft] ! date ( enactm5t (
 ?is subsection1 conduct p]iodic        
inspections ( ! records ( proxy advisory
 firms 9 accordance ) a s*$ule e/abli%$ 
by ! ,commission2 &  7ii7 :5 conduct+   
ea* inspection "u clause 7i71 review--  
7,i7 :e!r any proxy advisory firm1 )    
respect to any /atem5t made by ! firm to
 a cli5t ( ! proxy advisory firm1       

kn[+ly--  7aa7 made any false /atem5t to
 ! cli5t2 or  7bb7 omitt$ to /ate a     
mat]ial fact t w\ld be necess>y to make 
! /atem5t to ! cli5t n mislead+2 &      
7,,ii7 policies & programs reg>d+       
conflicts ( int]e/ at proxy advisory    
firms2 &  7,b7 may conduct1 9 addition  
to ! inspections conduct$ "u subp>agraph
 7,a71 at any "t & f "t to "t1 su*      
additional1 special1 & o!r exam9ations (
 proxy advisory firms & ! records (     
proxy advisory firms z ! ,commission may
 prescribe z necess>y & appropriate 9 ! 
public int]e/ & = ! protection (        
inve/ors4  7#b7 ,availability ( records 
,a proxy advisory firm %all make        
available to ! ,commission any copies or
 extracts f ! records describ$ 9        
subp>agraph 7,a77i7 or 7,b7 ( p>agraph  
7#a71 z applicable1 z may be prep>$ )\t 
undue ef=t1 exp5se1 or delay1 z !       
,commission or its repres5tatives may   
reasonably reque/4  2 &  7#e7 9 section 
#baa7;h7 7#ae ,u4,s4,c4 #hj;b-#aa7;h77--
 7,a7 by r$esignat+ p>agraphs 7#a7 &    

7#b7 z subp>agraphs 7,a7 & 7,b71        
respectively1 & adju/+ ! m>g9s          
accord+ly2  7,b7 9 ! matt] prec$+       
subp>agraph 7,a71 z s r$esignat$1 by    
/rik+ ,! ,commission & ins]t+ ! foll[+3 
7#a7 ,9 g5]al ,! ,commission  2  7,c7 9 
p>agraph 7#a71 z s r$esignat$-- 7i7 9   
subp>agraph 7,a71 z s r$esignat$1 by    
/rik+ & at ! end2  7ii7 9 subp>agraph   
7,b71 z s r$esignat$1 by /rik+ ! p]iod  
at ! end & ins]t+ 2 &2 &  7iii7 by add+ 
at ! end ! foll[+3  7,c7 n lat] ?an #b  
ye>s aft] ! date ( enactm5t ( !         
,corporate ,gov]nance ,fairness ,act1 & 
aft] consult+ ) all relevant /akehold]s1
 submit to ! ,committee on ,bank+1      
,h\s+1 & ,urban ,affairs ( ! ,s5ate & ! 
,committee on ,f9ancial ,s]vices ( !    
,h\se ( ,repres5tatives a report t--    
7i7 evaluates exi/+1 z ( ! date on :i* !
 report is submitt$-- 7,i7 policies &   
programs reg>d+ conflicts ( int]e/ at   
proxy advisory firms2 &  7,,ii7 policies
 & proc$ures at proxy advisory firms t  
are design$ to avoid kn[+ly mak+ any    

false /atem5t1 or omitt+ to /ate a      
mat]ial fact1 t w\ld be necess>y to make
 a /atem5t to a cli5t ( ! proxy advisory
 firm n mislead+2 &  7ii7 exam9es :e!r  
any additional protection to inve/ors "u
 subp>agraph 7,b7 w\ld be helpful to ^? 
inve/ors1 includ+ policies & proc$ures t
 all[ inve/ors to consid]1 9 a          
reasonably timely mann]1 mat]ial        
in=mation t is necess>y = ! inve/ors    
to--  7,i7 make in=m$ inve/m5t          
decisions2 &  7,,ii7 ex]cise any ( !    
rights ( ! inve/ors t are conf]r$ by    
securities held by ! inve/ors4  2 &     
7,d7 by add+ at ! end ! foll[+3  7#b7   
,updates ( proxy advisory firms report  
,n less frequ5tly ?an once e #e ye>s1   
beg9n+ on ! date on :i* ! ,commission   
submits ! report requir$ "u p>agraph    
7#a77;,c71 ! ,commission %all submit to 
! congressional committees describ$ 9 t 
p>agraph an updat$ v]sion ( t report1   
:i* %all evaluate :e!r ! exi/+ rules ( !
 ,commission1 z ( ! date on :i* !       
applicable updat$ report is submitt$1   

suffici5tly protect inve/ors1 includ+ ! 
ability ( inve/ors to consid]1 9 a      
reasonably timely mann]1 mat]ial        
in=mation t is necess>y = ! inve/ors    
to--  7,a7 make in=m$ inve/m5t          
decisions2 &  7,b7 ex]cise any ( !      
rights ( ! inve/ors t are conf]r$ by    
securities held by ! inve/ors4  4