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WASHINGTON The top U.S. securities regulator
unveiled plans on Friday to modernize corporate disclosure rules
and make it easier for investors to locate information that is
often buried in lengthy public company filings.
Acting Securities and Exchange Commission Chairman Michael
Piwowar said the agency’s two commissioners will vote on a raft
of non-controversial measures next week, as part of a project to
improve how information is disclosed.
“I am very pleased that we have immediate opportunities to
seek to provide meaningful disclosure improvements for the
forgotten investor,” said Piwowar, who spoke at the annual “SEC
Speaks” conference hosted by the Practising Law Institute.
The rules that will be contemplated at a public meeting on
March 1 are considered unlikely to generate much controversy.
The normally five-member panel is down to just two
commissioners, Piwowar, a Republican, and Kara Stein, a
Democrat. If the two cannot agree on whether to advance a rule,
then the measure fails.
President Donald Trump’s pick to head the SEC, attorney Jay
Clayton, has still not been confirmed by the U.S. Senate, and
Trump has not yet named the other two commissioners.
However, Clayton has privately conveyed his intention to
improve capital formation in talks with Trump and Trump’s staff,
and efforts to modernize disclosures are widely seen as an
important step toward that goal.
While Piwowar is limited in what he can accomplish, he also
spoke about some bigger-ticket items that he hopes the SEC can
do to improve capital formation.
In particular, he called on the SEC to overhaul outdated
rules that restrict retail investors who earn less than $200,000
or who have a net worth of less than $1 million from investing
their money in private securities deals.
Piwowar said the SEC’s current rules apply “artificial”
distinctions between accredited and non-accredited investors
that should be re-evaluated.
In the meantime, the SEC will focus on smaller ticket items
One such measure would require public companies to include
hyperlinks to exhibits attached to their corporate SEC filings.
The rule aims to make it easier for investors to retrieve
documents that, under the current regime, are often difficult to
Other steps the SEC will take include considering whether to
update 30-year-old banking industry disclosure guidance and
whether to propose requiring companies to use “inline XBRL”
Companies currently report financial data both in their
filings and through exhibits that contain “XBRL,” an
open-standard software that labels financial statements with
computer-readable tags that can be read like barcodes.
Inline XBRL essentially would embed the XBRL data into the
financial statements themselves.
The SEC will also separately consider whether to bolster the
kinds of disclosures that municipalities must provide to
brokerages that underwrite municipal bonds, Piwowar added. (Reporting by Sarah N. Lynch; Editing by Meredith Mazzilli and
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