H.R. 8286 — Protecting Americans’ Retirement Savings From Politics Act

This section limits Securities and Exchange Commission disclosure rulemaking under the Securities Act of 1933 and the Securities Exchange Act of 1934 by requiring the Commission to state that issuers need disclose information only to the extent they determine it is material to a voting or investment decision. Information is material if there is a substantial likelihood that a reasonable investor would view its omission as significantly altering the total mix of available information. The limitation does not apply to the removal of any existing disclosure requirement.

This section establishes the Public Company Advisory Committee within the Securities and Exchange Commission. The Committee provides advice on Commission rules, regulations, and policies relating to regulatory priorities, public company reporting and corporate governance, the proxy process, securities trading, and capital formation; submits findings and recommendations, including proposed regulatory and legislative changes; and meets at least twice annually. The Committee consists of 10 to 20 members, at least 50 percent of whom are officers or directors of public companies (excluding those owning asset management, broker-dealer, or proxy services businesses), serving 4-year staggered terms.

This section requires the Securities and Exchange Commission to study the detrimental impacts of the EU Corporate Sustainability Due Diligence Directive and Corporate Sustainability Reporting Directive on United States companies, consumers, investors, and the economy; their alignment with international human rights and environmental conventions; and the legal basis for their extraterritorial application. It directs the Commission to submit a report with findings and recommendations on mitigating measures or modifications to the Senate Banking Committee, House Financial Services Committee, Secretary of State, Secretary of Commerce, and United States Trade Representative within one year of enactment, and requires private entities to provide requested data.

This section requires the Securities and Exchange Commission to conduct a comprehensive study on proxy advisory firms and the proxy process not later than 180 days after enactment and every 5 years thereafter. The initial study covers the prior 10 years and each subsequent study covers the prior 5 years; each must examine financial incentives of participants, effects on retail investors, proxy advisor influence and any duopoly, issuer costs from shareholder proposals, impacts on companies going public, economic analyses by proxy advisors and investors, institutional investor reliance on recommendations, and adequacy of current regulation, with a report on the results submitted to the Senate Committee on Banking, Housing, and Urban Affairs and the House Committee on Financial Services.

This section prohibits proxy advisory firms from providing proxy voting advice, research, analysis, ratings, or recommendations unless registered with the Securities and Exchange Commission. It requires applicants to certify that advice is based on accurate information and provided in the best economic interest of shareholders, and to disclose methodologies, organizational structure, conflicts of interest, staff qualifications, and ethics policies. The Commission must review applications within 90 days and make registration information public.

This section treats the failure to disclose material information (such as a proxy voting advice business’s methodology, sources of information, or conflicts of interest) or the making of a material misstatement in proxy voting advice as false or misleading under subsection (a) and Rule 14a-9. The requirement applies to persons who market expertise as providers of such advice separately from other investment advice and sell it for a fee.

This section requires institutional investment managers that engage proxy advisory firms and exercise voting power over equity securities to file annual reports with the Securities and Exchange Commission detailing their votes on each shareholder proposal, the percentage of votes aligned with each retained proxy advisory firm’s recommendations, the degree to which those recommendations influenced decisions, reconciliation with fiduciary duties, frequency of vote changes due to errors or new issuer information, and involvement of investment professionals, along with a certification that all votes were based solely on shareholders’ best economic interests. Managers with at least $100 billion in regulatory assets under management must also perform and disclose economic analyses before casting votes inconsistent with recommendations from boards with a majority of independent directors and must clarify to customers that shareholders need not vote on every proposal.

This section requires the Securities and Exchange Commission to issue rules prohibiting robovoting on proxy or consent solicitation materials, defined as automatic voting aligned with a proxy advisory firm’s recommendations without independent review. It bars institutional investors from outsourcing voting decisions except to a registered or exempt investment adviser or broker-dealer that owes a fiduciary or best-interest duty, and provides that no person may be required to vote unless obligated by fiduciary duty or Rule 206(4)–6.

This section establishes proxy voting requirements for investment advisers holding authority over securities in passively managed funds. Advisers must vote according to beneficial owner instructions, issuer board recommendations, abstain while seeking quorum, or mirror other shareholders' votes, except on routine matters. It provides a liability safe harbor for compliant votes, exempts foreign private issuers with disclosed policies, requires distribution of voting policy selection forms with at least 5 business days for response, and defines passively managed funds as those allocating at least 60 percent of assets to index-tracking strategies.

This section requires that personalized investment advice determine a customer’s best interest using pecuniary factors, which may not be subordinated to non-pecuniary factors unless the customer provides informed consent or the advice is consistent with the customer’s written investment profile. It mandates qualitative disclosure of pecuniary effects when non-pecuniary factors are used and defines pecuniary factor as one expected to have a material effect on risk or return. The Securities and Exchange Commission must issue implementing rules within 12 months of enactment, with the requirements applying to advice and recommendations beginning 12 months after enactment.