SEC Must Keep Proxy Ballot Powers, Investor Advocates Tell Court

The SEC needs to maintain its power to influence what shareholder proposals appear on companies’ annual meeting proxy ballots, investor advocates told the Fifth Circuit in court filings supporting the agency.

The Securities and Exchange Commission is facing a lawsuit in the US Court of Appeals for the Fifth Circuit over its support for a Kroger Co. plan to block a conservative group’s shareholder proposal from its proxy materials. Companies usually seek the SEC’s blessing to avoid enforcement actions alleging they improperly scrapped shareholder proposals.

The National Center for Public Policy Research, which submitted the shareholder proposal, sued the SEC ...