Rep. Maloney Encourages SEC Chair Gensler to Strengthen Regulation Best Interest and Expand Corporate Board Diversity Efforts
WASHINGTON, DC — At today’s Financial Services Committee virtual hearing titled “Oversight of the U.S. Securities and Exchange Commission: Wall Street’s Cop Is Finally Back on the Beat,” Congresswoman Carolyn B. Maloney (D-NY), senior member of the committee, questioned Securities and Exchange Commission Chair Gary Gensler on his work to evaluate Regulation Best Interest and applauded his support of diverse corporate boards and workforces.
Congresswoman Maloney is the author of the Diversity in Corporate Leadership Act and a lead co-sponsor of the Improving Corporate Governance Through Diversity Act of 2021, which aims to increase diversity on corporate boards.
Congresswoman Maloney began by asking SEC Chair Gensler, “Can you give the Committee an update on your current thinking with Regulation Best Interest, the so-called ‘Fiduciary Rule,’ and whether you intend to take further action to strengthen this rulemaking?”
Chair Gensler responded, “I think that it’s important that this rule lives up to its potential – that ‘best interest’ really does mean best interest. So, working with our examination staff, working with our division of corporate finance, we’ve just hired an excellent person who’s a senior advisor to me directly, is to ensure that the retail public gets the best. But I’m also asking the staff to consider, how do we ensure that the brokers and the investment managers understand their duties under that rule and to ensure that […] best interest means best interest.”
Chair Gensler added, “If the rule doesn’t work, ultimately, we are going to look to make sure that brokers ensure that the investing public truly gets best interest.”
Congresswoman Maloney also asked Chair Gensler, “Do you intend to do anything in the board diversity area?”
Chair Gensler answered, “I’ve asked staff for recommendations in two areas related to this. One, with regard to the boards and board diversities, what recommendations that we as a commission meeting investor demand could do, but also more broadly the workforce, the entire workforce, and what we have come to call human capital disclosure. That’s not just about part-time versus full-time and the pay rates and the like, but it’s also about the diversity of the workforce as a whole.”
You can watch the full exchange here.