[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 1181 Introduced in Senate (IS)]







110th CONGRESS
  1st Session
                                S. 1181

 To amend the Securities Exchange Act of 1934 to provide shareholders 
            with an advisory vote on executive compensation.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 20, 2007

   Mr. Obama introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL


 
 To amend the Securities Exchange Act of 1934 to provide shareholders 
            with an advisory vote on executive compensation.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Shareholder Vote on Executive 
Compensation Act''.

SEC. 2. SHAREHOLDER VOTE ON EXECUTIVE COMPENSATION DISCLOSURES.

    (a) Amendment.--Section 16 of the Securities Exchange Act of 1934 
(15 U.S.C. 78n) is amended by adding at the end the following new 
subsection:
    ``(h) Annual Shareholder Approval of Executive Compensation.--
            ``(1) In general.--Any proxy or consent or authorization 
        for an annual or other meeting of the shareholders occurring on 
        or after January 1, 2009, shall permit a separate shareholder 
        vote to approve the compensation of executives as disclosed 
        pursuant to the Commission's compensation disclosure rules 
        (which disclosure shall include the compensation discussion and 
        analysis, the compensation tables, and any related material). 
        The shareholder vote shall not be binding on the board of 
        directors and shall not be construed as overruling a decision 
        by such board, nor to create or imply any additional fiduciary 
        duty by such board, nor shall such vote be construed to 
        restrict or limit the ability of shareholders to make proposals 
        for inclusion in such proxy materials related to executive 
        compensation.
            ``(2) Shareholder approval of golden parachute 
        compensation.--
                    ``(A) Disclosure.--In any proxy solicitation 
                material for an annual or other meeting of the 
                shareholders occurring on or after January 1, 2009, 
                that concerns an acquisition, merger, consolidation, or 
                proposed sale or other disposition of substantially all 
                the assets of an issuer, the person making such 
                solicitation shall disclose in the proxy solicitation 
                material, in a clear and simple form in accordance with 
                regulations of the Commission, any agreements or 
                understandings that such person has with any principal 
                executive officers of such issuer (or of the acquiring 
                issuer, if such issuer is not the acquiring issuer) 
                concerning any type of compensation (whether present, 
                deferred, or contingent) that are based on or otherwise 
                relate to the acquisition, merger, consolidation, sale, 
                or other disposition, and that have not been subject to 
                a shareholder vote under paragraph (1).
                    ``(B) Shareholder approval.--The proxy solicitation 
                material containing the disclosure required by 
                subparagraph (A) shall require a separate shareholder 
                vote to approve such agreements or understandings. A 
                vote by the shareholders shall not be binding on the 
                board of directors and shall not be construed as 
                overruling a decision by such board, nor to create or 
                imply any additional fiduciary duty by such board, nor 
                shall such vote be construed to restrict or limit the 
                ability of shareholders to make proposals for inclusion 
                in such proxy materials related to executive 
                compensation.''.
    (b) Deadline for Rulemaking.--Not later than 1 year after the date 
of the enactment of this Act, the Securities and Exchange Commission 
shall issue any final rules and regulations required by the amendments 
made by subsection (a).
                                 <all>