June 05, 2013

Senator Elizabeth Warren Urges NYSE, NASDAQ to Propose Rules Requiring "One Share, One Vote" Structures

WASHINGTON, DC - United States Senator Elizabeth Warren (D-MA) today sent a letter to New York Stock Exchange (NYSE) Vice President John Carey and NASDAQ Executive Vice President & General Counsel Edward Knight, urging their organizations to consider proposing rules requiring "one share, one vote" corporate structures for listed companies.

Sen. Warren asks NYSE and NASDAQ to declare companies ineligible for an initial listing if they have unequal voting rights, and to prohibit already listed companies from issuing additional classes of common stock with unequal voting rights - a request made by the Council of Institutional Investors in an October letter. "If a company goes to the public markets to raise money, long-term ordinary common stock investors - a category that includes directly or indirectly millions of retirees and workers - should be entitled to certain basic rights," writes Sen. Warren.  "One of the most basic of those rights is one-share-one-vote."

Sen. Warren highlights several problems with unequal voting arrangements. She notes that under these structures, "Long-term investors will have limited recourse in holding management and the board accountable if the company heads in a wrong direction." Sen. Warren's letter asks NYSE and NASDAQ to issue proposed rules addressing this issue for public comment.

The full text of Sen. Warren's letter is available here.