June 5 A U.S. senator has asked exchange
operators NYSE Euronext and Nasdaq OMX Group to
consider proposing rules that would require the companies that
list their shares with them to have "one share, one vote"
Some companies have multi-class voting structures that give
certain classes of shares, such as those held by founders and
initial executives, multiple votes per share.
Such structures give many average investors limited
discourse in holding management and the board accountable if the
company heads in a wrong direction, Massachusetts Democratic
Senator Elizabeth Warren said in a letter to the exchanges on
Wednesday. (Link to Warren's 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 basic rights," she said. "One of the
most basic of those rights is one-share-one-vote."
Representatives at NYSE and Nasdaq declined to comment.
Warren, a member of the Senate Banking Committee, said the
number of public companies using multi-class stock structures
has risen sharply in recent years.
The Council of Institutional Investors wrote a letter to the
exchanges on Oct. 2 asking them to require one-vote-per-share.
Many mutual fund providers, including Fidelity and Vanguard,
oppose the introduction of new classes of stock with unequal
voting rights, Warren said.
Prior to being elected in November, Warren led a
congressionally appointed panel tasked with keeping an eye on
the government's bailout of the financial system. She also
championed the creation of the Consumer Financial Protection
Bureau, which was created by the 2010 Dodd-Frank oversight law
and which she set up.