Senators Introduce Bill To Protect Shareholders
RENEE MONTAGNE, host:
Also in Washington, two Democratic lawmakers yesterday introduced a Shareholder Bill of Rights. It would give investors more say over how public companies operate.
NPR's David Greene reports.
DAVID GREENE: Senators Charles Schumer of New York and Maria Cantwell of Washington say corporate executives have been making huge salaries and taking too many chances. Their new legislation would require publicly traded companies to have committees that assess risk and shareholders would have new power. Long-time investors would have some say over who sits on a company's board. And companies would have to let shareholders take a nonbinding vote on executive compensation.
Now, these aren't new ideas. In March, President Obama said the federal government should force companies to give shareholders a bigger role. Mr. Obama said he had been lobbying for that since before he was president.
President BARACK OBAMA: There were some people who attacked us, saying government has no business doing that. Well, look - all we're trying to say is you've got to be accountable to somebody.
GREENE: Somebody but maybe not the federal government. Tom Quadman(ph), an executive director at the U.S. Chamber of Commerce, said state lawmakers have done an admirable job protecting shareholders. He said giving the federal government more power to meddle in big companies' business is dangerous. He also said Schumer's bill ignores the fact that most companies are responsive to shareholders and operate responsibly.
Mr. TOM QUADMAN (U.S. Chamber of Commerce): There are 15,000 public companies in the United States that get it right and they get a right every day.
GREENE: Get ready to hear a lot more of this debate. Senator Schumer said his bill is only a piece of a big financial reform package he wants Congress to crank out this year.
David Greene, NPR News, New York.