The bylaw changes
and the consolidation that will follow would result in meaningful and
long-sought after benefits to small firms, including: cost savings as a result
of less duplication and redundancy, more efficient regulation and oversight,
and improved investor protection. The
new board structure achieves a balance between public and industry segments and
provides for greater representation on the Board of Governors for small firms.
Firms of all sizes will continue to avail themselves of the same “one firm, one
vote” they currently have for voting on by-law amendments, District Committees
and other membership votes.
Other consolidation
benefits highlighted in the statement include:
- Improved
regulatory effectiveness. Regulatory consolidation will short
circuit “regulatory one-upmanship” that all firms have labored under
during the past several years. After the consolidation, the combined NYSE
Regulation/NASD will speak with one, much stronger voice.
- Elimination
of costly redundancy. The creation of a single SRO will help
eliminate duplicative and unnecessary layering of rules as the new entity
works through the rule harmonization process. Savings will be passed on to
all members of the new SRO.
- More
industry representation on the Board. The new Board will have a
higher ratio of industry to non-industry/public members. Currently,
industry representation stands at 35%.
Under the new structure, industry representation on the Board of
Governors would increase to 43%.
- Increased
small firm representation on the Board. The new Board
configuration will guarantee three small firm seats, for a permanent net
increase of two small firm representatives. Under the current Board
structure, only one small firm seat is guaranteed on the Board.
The Committee also
commends Schapiro and her team for embarking on a Roadshow tour to clarify for
firms the effects the consolidation will have on firms. The tour will make stops at 26 locations
throughout the country in the month of December.
To view the full
statement, please visit: http://www.sia.com/committees/pdf/SmalllFirmsStatementNASDNYSEConsolidation.pdf
To participate in a
conference call on SIFMA small firms’ perspective on the consolidation at 4 pm
today, please dial: 1-800-860-2442
and request the SIFMA-Small Firms bridge.
Please RSVP by email to Melissa Buden at mbuden@sifma.org.
