The
Securities and Exchange Commission yesterday voted unanimously to require mutual funds to disclose how they determine vote proxies and the funds' records of past votes.
They new draft rules are now subject to a sixty-day public comment period. The SEC also passed a similar set of rules for investment advisors.
The fund industry did win a compromise on one point. Funds will only have to provide the disclosures when they receive a request. They will not have to post them publicly through the internet. They will also have to submit the voting records semi-annually through Edgar.
Under the proposed regs, shareholders may request the disclosures by calling a toll-free or collect telephone number. The fund would have three business days to fulfil the request.
Funds that cast votes differing from their proxy guidelines would be required to disclose those votes in their shareholder reports and to explain the circumstances of the vote. 
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