Enhancing Multi-Class Share Disclosures Act

This bill makes companies with more than one class of stock clearly show who holds power when they ask shareholders to vote. In the materials sent before annual meetings, they must list, for each director, director nominee, top paid executive, and anyone who controls 5% or more of total voting power, both the percentage of the company’s voting shares they own and the percentage of total voting power they hold. This helps regular investors see how control is concentrated, especially at companies where founders or insiders have special voting rights (; ). A “multi-class” setup means a company has two or more types of shares with different voting rights, such as one class for the public with fewer votes and another for insiders with more votes (; ).

Key points:

• Who is affected: Public companies with multiple classes of stock that carry different voting rights ().
• What changes: They must disclose, in plain numbers and percentages, how many voting shares and how much voting power key people and any 5%+ voting power holders have (; ).
• When: The SEC will set the rules and require these disclosures in shareholder voting materials and other filings it deems appropriate (; ).