On October 18, 2010, the SEC proposed Rule 14Ad-1 under the Exchange Act, which would require institutional investment managers subject to Section 13(f) of the Exchange Act (i.e., advisers with discretionary authority over accounts holding equity securities with an aggregate fair market value of at least $100 million) to report how they vote proxies on, among other things, executive compensation matters. Specifically, proposed Rule 14Ad-1, if adopted, would require institutional investment managers to disclose annually on Form N-PX how they voted on so-called “say-on-pay” and related matters proposed by companies over which the institutional investment managers have voting authority.  

To assist in the implementation of proposed Rule 14Ad-1 and to provide clarity to the reporting requirements, the SEC also proposed certain amendments to Form N-PX, which is currently only used by registered funds. The proposed amendments to the Form are meant to accommodate reporting by institutional investment managers. Among other things, Form N-PX would be amended to include a new summary page intended to enable users to identify any institutional investment manager (in addition to the person filing the report) whose say-on-pay votes are included in the report, and those institutional investment managers whose say-on-pay votes are not included in the Form. These new requirements would also apply to the proxy voting reporting by registered funds.

While information filed on Form N-PX is publicly available under the proposal, an institutional investment manager could request confidential treatment of information reported on the Form.

Comments on the proposals are due by November 18, 2010.