New Disclosure Rules for Fund Directors and Boards
The SEC has adopted new proxy and SAI disclosure rules concerning director information. Proxies for the election of fund directors and the revised SAI will be required to include “the specific experience, qualifications, attributes, or skills that led to the conclusion that the person should serve as a director.” The forms must also describe the board’s leadership structure, whether the chairman is an “interested person”, a description of the board’s role in risk oversight, and the reasons why the leadership structure is appropriate. The SAI must also describe whether the fund has a lead independent director. The new rules become effective on February 28, 2010.
OUR TAKE: Although these are disclosure rules, we expect that funds will increase their focus on the qualifications of Board members and the governance structure.