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Investment Issues Affecting the Security of Plan Assets
Ann Yerger,
Deputy Director, Council on Institutional Investors
The Council on Institutional Investors today asked for NCPERS’ support of a four-point legislative program that would benefit investors, including public pension fund managers. Council Deputy Director Ann Yerger discussed the following four issues:
First, preserve and strengthen the Sarbanes-Oxley law, which was Congress’ response to the corporate scandals typified by Enron and WorldCom. The law strengthens auditing requirements and imposes bigger penalties and fines on violators. The Council opposes recent corporate proposals to amend the law’s requirements. It supports legislative proposals to strengthen those sections requiring corporate restitution.
Second, oppose legislation that would alter the accounting treatment of stock options by removing Financial Accounting Standards Board (FASB) oversight of the issue. Several pending bills would remove the requirement to treat options as expenses, as FASB is expected to recommend in a report to be issued this spring.
Third, improve access to the proxy vote, making it easier for investors to nominate candidates to corporate boards of directors. The SEC will soon consider a new rule on the issue.
Last, support new SEC rules to separate regulatory and business functions of stock exchanges and improve the transparency of their reporting. “Self-regulation of the exchanges is not working,” Yerger stated, “which is why we need new SEC rules.”
Yerger joined the Council of Institutional Investors in early 1996 as the director of the Council’s Research Service. Founded in 1985, the Council is an organization of more than 130 public, corporate, and Taft-Hartley pension funds which manage in aggregate over $3 trillion in assets.
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