Governance: treasury's Snow criticizes shareholder access concept.

• Author: Marshall, Jeffrey
• Position: Securities and Exchange Commission - Brief Article

The controversial Securities and Exchange Commission (SEC) proposal to give shareholders limited ability to nominate directors to corporate boards, already in limbo, has an influential foe: Treasury Secretary John Snow.

The proposal "is more likely to backfire and do damage" than improve corporate governance, Snow said in remarks in late May. He emphasized that the Sarbanes-Oxley Act has already ratcheted up pressure on board members to live up to their fiduciary responsibilities.

"Integrity has been put back in the system. There are no more half-hour audit committee meetings," Snow said. As a result, he said, the SEC's proposed Rule 14a-11 is unnecessary and could result in more problems for companies trying to move away from the intense focus on short-term numbers.

"The sort of proposal that's pending could be commandeered by those who aren't interested in the long-term health of the company," Snow said.

The so-called "shareholder access" issue has proven to be contentious...